Oral Answers to Questions

WORK AND PENSIONS

The Secretary of State was asked—

Financial Inclusion

Adrian Bailey: What discussions he has had with the Chancellor of the Exchequer on providing financial inclusion programmes in local communities.

James Plaskitt: My Department works very closely with Her Majesty's Revenue and Customs and the Department for Business, Enterprise and Regulatory Reform in delivering the Government's programmes to promote financial inclusion. For example, we are currently establishing a network of regional and national champions, including for the west midlands, who will help to lead local partnerships to increase financial inclusion.
	My hon. Friend might also be interested to know that already 12 west midlands credit unions and community development finance institutions are benefiting from growth fund investment from my Department.

Adrian Bailey: I welcome the Minister's response. I represent a constituency that still has a high proportion of low-income earners. What can my Department do to help those in my constituency who may be vulnerable to the activities of loan sharks?

James Plaskitt: My hon. Friend represents a constituency in that situation, as do many others. The Department has done some mapping across the country to help to establish which areas are in the greatest need of additional resources. Several things are being done to address his specific concerns. First, as I have said, we co-operate with colleagues in the Department for Business, Enterprise and Regulatory Reform, and they are running crackdowns on illegal lenders in areas where they are at work. My Department is also doing some work through the growth fund, which is investing in credit unions and helping them to grow. Where we have invested, credit unions are growing rapidly, providing a source of affordable credit in the community so that people do not have to turn to, or rely on, doorstep lending or loan sharks.

Peter Luff: The single most important thing that the Government can do to ensure financial inclusion in remote rural and deprived urban communities is to ensure access to cash. In that context, will the Minister assure me that the Department will do all that it can to ensure that it and all its agencies give equal prominence in, for example, every letter sent to benefit claimants to the opportunity to obtain cash at the post office through the Post Office card account? Will he join me in deploring the Pension, Disability and Carers Service in particular, which has been actively misleading clients about the future of the POCA and, in many letters, failing even to say that it is available?

James Plaskitt: I believe that one letter was sent out locally that was incorrect, and we have retracted that statement and checked that the letters being sent out are correct. It is always our policy to ensure that benefit claimants or pensioners who wish to receive their benefits or pension in cash at a post office can continue to do so.

David Taylor: I was pleased to hear my hon. Friend the Minister refer to credit unions, because, as a long-term member in my area, I know how much they can promote financial inclusion. Does he agree that local post offices often best provide credit union facilities? Would it not therefore be a good idea if the Post Office card account contract were given to the Post Office itself? Any other decision would be deeply regrettable.

James Plaskitt: My hon. Friend knows that the contracting arrangements for the successor to the existing Post Office card account are determined legally. The tendering process is under way, so it would be inappropriate for me to go any further. The Post Office has said publicly that it has put in a tender for the contract, which it describes as "strong", but I cannot go any further, as I am sure my hon. Friend will understand. Ministers are not involved in determining the tendering process, which is run by officials.
	I strongly sympathise with my hon. Friend's point about possible stronger links between credit unions and the Post Office. He will be interested to note HMRC's announcement last week about reforms to the regulatory climate that applies to credit unions. It implies greater flexibility in the future and the long-term possibility of establishing closer links with the Post Office.

Child Poverty

David Gauke: What steps he plans to take to achieve the target of halving child poverty by 2010.

Andrew Gwynne: What steps he plans to take to meet the Government's 2020 child poverty reduction target; and if he will make a statement.

James Purnell: "Ending Child Poverty: Everybody's business" announced an additional £950 million for tackling child poverty. Along with the commitments in last year's Budget and pre-Budget report, about 500,000 more children will be lifted out of relative poverty than otherwise would be.

David Gauke: The Prime Minister told the House on 23 and 30 April that the Government were "on the road" to taking 1 million children out of poverty. Will the Secretary of State confirm that not only is the up-to-date figure closer to half the 1 million figure, but in each of the past two years the number of children in poverty, on the Government's own measure, has increased by 100,000?

James Purnell: No, we have lifted 600,000 children out of poverty and, as I said in my answer, another 500,000 are in the pipeline, so to speak. Interestingly, the hon. Gentleman refers to the Prime Minister, but his leader just made a speech about social breakdown in which he did not even mention child poverty. We are committed to the target; the Opposition are not. We care about child poverty; they do not. That speech shows that the Tories have not learned the lessons of the 1980s and would be exactly the same if they were to return to power. The hon. Gentleman should tell his leader to withdraw his speech.

Andrew Gwynne: Will my right hon. Friend ignore the doom-merchants opposite and commit the Government not only to meeting the 2020 target but to keeping the current definition of poverty? Will he reject the calls from some in this Chamber to redefine poverty rather than to tackle and abolish it, which is what the Government are committed to doing?

James Purnell: That is absolutely right. We are the only party that is committed to the target. We will keep the definitions that we have set out and the three targets. It is quite clear that the Opposition want not to reduce child poverty but to redefine it.

Mr. Speaker: Order. May I tell the Secretary of State that the point has been made about the Opposition, and from now on his answers should be about ministerial responsibilities?

Alistair Burt: May I say that, on reflection, the Secretary of State might regret comments suggesting that caring about child poverty is purely a party issue? He might want to reshape those remarks when he gets a chance. Is he not concerned that the figures show that the percentage of children risking poverty in two-parent families is hardly different from 1997? In fact, percentage-wise, the figure has gone up slightly. In caring for children in poverty, will the Secretary of State see whether he could do something more about how welfare policies act on two-parent families, because we all care about the issue?

James Purnell: The hon. Gentleman is absolutely right that we need to support two-parent families as well as lone-parent families. The risk of child poverty is higher in a lone-parent family than it is in a two-parent family, but we need to support both. We need to get partners in two-parent families into work to reduce child poverty, and we need to do the same for lone parents, but caring about child poverty means doing something about it. That means spending money and having a target.

Frank Field: I again congratulate the Government on setting such an audacious target to abolish child poverty, given that no other Government have ever set themselves that task. Does my right hon. Friend agree that, despite all the Government's efforts, progress has stalled somewhat? Given that huge sums will not be available to increase tax credit payments still further, does he believe that the Government should reschedule the priority that they give to moving claimants from benefit into work so that we achieve the target?

James Purnell: My right hon. Friend is absolutely right to say that the figures for the past two years have been disappointing. We said that. That is exactly why we redoubled our efforts and put in the extra £1 billion. He is right, too, that reducing child poverty is not just about tax credits and benefits, but about getting people back into work. Our goal is to do both. Talking about only the causes of poverty ignores the fact that one of its causes is not having enough money. That is why we also believe in increasing the money that goes to tax credits and child benefit, which we did at the previous Budget.

Jennifer Willott: One group who can experience particularly severe poverty is disabled children. The Secretary of State will know that receipt of disability living allowance grants access to a range of other benefits that go alongside it, including disabled premiums on tax credits, and that, without it, families can miss out on upwards of £10,000 a year. Given that the Government are unable to provide figures on DLA take-up rates, what action will his Department take to increase take-up of DLA and reduce the dire poverty faced by those particularly vulnerable children?

James Purnell: We are working to increase the take-up of DLA among families with disabled children. I recently met the Every Disabled Child Matters campaign, and we are working with it and others to increase take-up. We are spending money on a take-up campaign to ensure that everybody who is entitled to DLA claims it. Hon. Members can play their part, too, by ensuring that their constituents know that they should be claiming DLA if their children face those issues.

Andrew Selous: The Secretary of State talks about getting people back to work, and he is right to do so. He will be aware that half of children in poverty have a parent in work and that more than a fifth of poor children have a parent who works full time. What will the Government do to address the needs of that group of parents who earn enough to keep their children out of poverty but are then taxed to below the poverty line, even after receipt of tax credits?

James Purnell: The issue is about helping partners into work and making sure that we provide more money through tax credits, which is exactly what we did in the previous Budget. We want to consider how we can help partners to work, because very few families in which one partner works and the other works part time, or in which both work, are in poverty; I think that about 2 per cent. of children, a very low percentage, in such families are in poverty. We want to help people to work, and we want to give them more money, too. We want to tackle the causes of poverty and to give people more money through tax credits.

Disabled People (Budgets)

Robert Flello: What assessment he has made of the effectiveness of independent budgets and direct payments for disabled people.

James Purnell: We know from research that people in receipt of direct payments value the freedom and flexibility that they give, but take-up has not been as widespread as had been hoped. Individual budgets were piloted so that we could see whether the benefits of greater choice and control could be provided for people who did not want a direct payment. Researchers are analysing the findings from the pilot and a report will be published later this year.

Robert Flello: I am grateful to my right hon. Friend for that reply. People with disabilities face enough difficulties and barriers in society without their care package being one of them. Will he commit to accelerating the roll-out of individual budgets, while ensuring that people with disabilities and their carers have full support, so that we can be sure that they can use the packages?

James Purnell: My hon. Friend is absolutely right that individual budgets can give disabled people, as well as other groups, control over the support that we give them. The vast majority of disabled people are very happy with the support that they get, but that where they are not, or where they feel that they could do better themselves, we must consider how we ensure they have control. We will actively look into that issue in the next few weeks.

Mark Harper: I recently saw for myself how successful the In Control project, which has cross-party support, has been in Oldham, and what a difference it has made to the lives of disabled people. The Government want 1.7 million people to be able to have independent budgets over the next three years. How many of those people does the Secretary of State expect to be able to have independent budgets by the end of next March?

James Purnell: As I said, we will consider that issue in the Green Paper, and the hon. Gentleman will have to wait until it is published.

Brian Jenkins: My right hon. Friend will know of the small problem with recipients seeking and finding the information they need to make the right choice about individual budgets. Is he aware that no one seems to have responsibility for compiling and maintaining a directory of services that those people could buy into?

James Purnell: My hon. Friend is right to say that one of the early findings from the pilots is the importance of advocacy and support. That is not a reason to think that the principle is not right; it is just a lesson that we need to learn to make sure that the system works effectively in practice. I will look into the point that he makes about a directory, and I will write to him.

Jobshop (York)

Hugh Bayley: When Remploy plans to open a jobshop in York city centre to assist people with disabilities who were not previously Remploy employees in finding jobs.

Anne McGuire: Remploy continues to search for suitable premises in York city centre. In the meantime, Remploy opened a facility on 9 April at York university, which is available to help all disabled jobseekers in York. Remploy is also working in partnership with Future Prospects, a local specialist provider, which means that any disabled jobseeker in York will be able to access Remploy services through Future Prospects' city-centre facilities.

Hugh Bayley: When the Minister made the case for closing the Remploy factory in York, she said that, if it closed, a city-centre jobshop would be established and that it would get 50 disabled people who were out of work—not former Remploy employees—into work each year. The facility on York university campus helps former workers from the York Remploy factory, but it is essential that a new facility is provided in the city centre as soon as possible; otherwise, the Government will not meet their target of getting 50 disabled people into work each year.

Anne McGuire: My hon. Friend has taken a keen interest in the situation in York, and I congratulate him on his advocacy for his local facility. There have been difficulties in trying to get premises in York city centre, not least due to access issues, but I assure my hon. Friend that Remploy is actively and positively looking for facilities in York city centre.

Anne McIntosh: The Minister will be aware that the closure of the Remploy facility in York caused disabled people particular problems in getting back into work, but will she accept that the number of people in work in York has gone down hugely, particularly in the past three years? The latest closure was of an HMRC office. What plans does she have to find another facility, perhaps locally, so that those currently working there can continue to work in York?

Anne McGuire: With Remploy, we looked specifically at how we support disabled workers into employment. If we are talking about the generality of people who can access jobcentre facilities, that is a slightly different issue. I hope that the hon. Lady accepts that Remploy in York has been working very actively to support its disabled employees, who wanted to maintain themselves in employment. Outside this forum, I will be delighted to share with her some of the real success stories that have come out of York about former Remploy employees.

Ann Clwyd: As my hon. Friend knows, I was very pleased that Remploy in my constituency was removed from the list of closures, but its continuing existence depends on it securing contracts. It supplies health care products to England and to Scotland but has no contracts in Wales. I made every effort to secure those contracts, but what else can the Government do to ensure that the factory, which is very important to our area given the high percentage of disabled people, continues in existence?

Anne McGuire: I thank my hon. Friend for championing her local Remploy factory and for supporting the modernisation programme. She is right—there was extreme disappointment that the Welsh health service did not renew its contract with her local Remploy factory. I can assure her, however, that Remploy's management are still optimistic about getting more work not only into her Remploy factory but into Remploy factories across the country as part of its modernisation programme.

Poverty (Elderly People)

Ann Winterton: If he will make a statement on trends in levels of poverty among the elderly. [Official Report, 10 July 2008, Vol. 478, c. 12MC.]

Mike O'Brien: The number of pensioners in relative poverty has fallen by 900,000 since 1997, and the number in absolute poverty has fallen by 1.9 million.

Ann Winterton: The Government's fuel poverty target has, according to their own advisers, been missed, so I wonder what warm words they can offer elderly people and pensioners who face dramatically increased fuel costs. The Government appear to have no clear strategy for addressing fuel poverty among the elderly, who will be too afraid to turn up or even to switch on the heating in case they incur very large bills. What action will they take to assist this most vulnerable section of our community?

Mike O'Brien: I would have thought that the hon. Lady had informed her constituents that winter fuel payments will increase this year. There will be an extra £50 a week for those aged between 60 and 80 and an extra £100 for those aged over 80, bringing to £250 the amount that the Government provide to the elderly each year to help with their winter fuel bills. An extra £400 in winter fuel payments will be paid to those aged over 80. Indeed, we are going further than that by taking powers in the Pensions Bill, which is currently going through the other place, that will enable the data sharing of information with suppliers so that poorer pensioners can be put on to lower social tariffs, ensuring that they pay lower bills and get insulation. Warm Front has given 1.7 million homes assistance on insulation: an average of £2,700 has been provided to ensure that homes are insulated and fuel bills are kept down, so quite a lot is happening in this respect.

Sally Keeble: I welcome the progress in tackling pensioner poverty. Does my hon. and learned Friend agree that one of the most important safeguards against pensioner poverty, especially for women pensioners, is the chance to have a work-related pension pot, and will he say what progress is being made on the development of personal accounts?

Mike O'Brien: We certainly need to ensure greater pension equality for women. We reformed the state pension system to ensure that the number of women who receive a full basic state pension will rise from about a third to 75 per cent. in 2010, and, indeed, up to 90 per cent. in the 15 years thereafter. That will give them equality with men, but it is only the basis of change. We are introducing automatic enrolment, which will ensure that the employers of millions of women currently unable to get a private pension will be obliged to provide one, into which the women will be automatically enrolled. Millions of women will be able to build a pension pot to give them a more secure retirement.

Hywel Williams: Last month, the town council of Pwllheli in my constituency wrote to the Secretary of State expressing concern about pensioner poverty. The reply referred to the availability of pensioner credit, housing benefit and council tax benefit. Is the Minister satisfied with the take-up of those benefits, and, if so, will he tell the House, and Pwllheli town council what the take-up level is?

Mike O'Brien: I am not satisfied with the take-up of pension credit, which is why we are undertaking reforms, including, as of October this year, making pension credit, council tax benefit and housing benefit more easily accessible. We will introduce a series of changes whereby an application for one will automatically entitle someone to the others. Help the Aged and Age Concern have requested the change for a number of years, and it will be introduced from October. I hope that the hon. Gentleman is assured that action is being taken.

Michael Jabez Foster: Our Labour Government's passion for eradicating pensioner poverty should be applauded. Until April of this year, it could be said with certainty that no pensioner was worse off as a result of a Labour Government, and that the poorest were £40 a week better off. Given recent inflation figures, does my hon. and learned Friend believe that the rate of inflation, rather than the retail prices index, should apply to pension increases next year?

Mike O'Brien: We have addressed the matter of uprating, but we want to restore the link with earnings, which, as my hon. Friend knows, the Conservatives removed some time ago. We have said clearly that we intend to restore the link by the target date of 2012, or in the course of the following Parliament, and we aim to use its restoration as a foundation block on which to build better pension entitlement for the long term.

Nigel Waterson: Does the Minister accept that the latest figures, which show that an extra 300,000 of our older citizens now live in poverty—well above 2 million—are bad enough, but that since the statistics were prepared even more pensioners will have been driven into poverty by the recent surge in energy and other living costs? Is it not time that the Government got serious about tackling pensioner poverty?

Mike O'Brien: I have to ask the hon. Gentleman whether he remembers that it was his party that broke the earnings link—this party is committed to restoring it. Does he remember that his party left millions of pensioners destitute and in poverty, on £68.80 a week? Under us, the minimum that people have a right to receive is £124, and we hope to be able to continue to increase it. We have lifted 1.9 million people out of absolute poverty—poverty that his party left those people in.

Dennis Skinner: Whatever happens in the course of the next winter, one thing is certain: I do not expect anybody from our Front Bench to tell old-age pensioners to knit a woolly hat or to take a hot water bottle to bed, just like the Minister did in those grim Tory years. What was her name? It was Edwina Currie, and there are a load of them on the Tory Benches that act just like her.

Mike O'Brien: My hon. Friend is entirely right. We do not need to say that, because we will provide additional help to pensioners so that they can turn up the heating rather than worry about having to knit. The Conservative party's attitudes are exemplified by that comment, and this Government's attitudes are exemplified by the fact that we are increasing payments to pensioners at the very time when fuel bills are going up. We acknowledge that, and we are doing something to help pensioners.

Nigel Evans: The Minister will know that the elderly tend to look to their families to give them some support after they have retired, which no doubt saves the Treasury hundreds of millions of pounds. However, if their children have emigrated, particularly to Commonwealth countries, and they follow them to those countries, we treat them as second-class citizens and do not uprate their pensions. They can therefore become impoverished. When are we going to bring justice to British pensioners who decide to emigrate to Commonwealth countries to live closer to their families in retirement?

Mike O'Brien: The hon. Gentleman will know that the long-standing policy, which both the Conservatives and this Government have adopted, is that we will not uprate the pensions of those in non-EU countries unless we have an agreement for reciprocal uprating with those countries. Although a case can be made for those who live in other countries, if there is additional money to spend and there are still issues of pensioner poverty in this country, which there are, my priority ought to be to reduce that poverty. If there is any extra money, that is what I intend it to be spent on.

Child Poverty

Clive Betts: What recent discussions he has had with the Chancellor of the Exchequer on measures to reduce levels of child poverty.

Stephen Timms: We discuss the child poverty strategy regularly with Treasury Ministers. For example, I shall meet the Financial Secretary to discuss that subject later today. We have a shared commitment to make further progress in reducing child poverty, building on what has been achieved so far.

Clive Betts: I welcome my right hon. Friend's commitment, but may I draw his attention to an anomaly? Many children in this country have parents who work but do not pay income tax, because they do not earn enough. Parents in those same families could well be paying council tax, because the level at which council tax is paid is lower than that at which income tax is paid. Will he consider raising the threshold for both council tax benefit and housing benefit? At a stroke, he could take a step that would take thousands of children out of poverty and go a long way towards helping the Government meet their targets.

Stephen Timms: My hon. Friend makes an interesting point, which, as he will know, the Select Committee on Communities and Local Government raised last year. Of course, council tax is a tax on property rather than on income, so it is not too surprising that the conditions are a little different. We said in our response to the Committee's report that we were prepared to examine the viability of aligning council tax benefit eligibility with other parts of the tax and benefits system over time. It cannot be done very quickly, but my hon. Friend is right to draw attention to the case for greater alignment, and we will examine the viability of that.

Phil Wilson: Will my right hon. Friend join me in congratulating the Sure Start children's centres in Chilton, West Cornforth, Dean Bank, Fishburn, Newton Aycliffe, Thornley, Wheatley Hill and Wingate in my constituency on their work in alleviating child poverty? Does he agree that that is a crusade for this Government, not just an aspiration, as it is for the Opposition? They had 18 years to get it right, and they did nothing.

Stephen Timms: I agree completely with my hon. Friend and join him in paying tribute to those Sure Start centres for their achievements and lamenting the absence of a commitment from the Opposition. Sure Start has not only provided the best possible start for young children and made a very important contribution to tackling disadvantage among children, but is increasingly providing places where support can be directed to parents. There is help back into work, advice on applying for and receiving tax credits and other help that people need.
	I recently visited a Sure Start centre in Lambeth, where a back to work course being delivered by Tomorrow's People was doing a great job. We want Sure Start centres to be used increasingly in that way.

Benefit Claims

John Heppell: What progress has been made on the use of voice recognition analysis in respect of benefit claims.

James Plaskitt: Voice risk analysis is being piloted by 14 local authorities for claims and reviews of housing and council tax benefits. Those pilots are going well, and so a further 15 are being arranged. We are also piloting that technology in Jobcentre Plus for jobseeker's allowance and income support claims. Full evaluation results from the initial pilots will be available later this year.

John Heppell: I welcome anything that tackles benefit fraud, but will the Under-Secretary assure me and the House that those analyses will not be used to target vulnerable people or, indeed, result in the withdrawal or withholding of any benefits without real evidence?

James Plaskitt: I can give my hon. Friend that absolute reassurance. The technology that is in use does not in itself prove benefit fraud. All that it does is indicate levels of potential risk in the call, which lead us to decide which verification process to follow to establish the merit of the claim. When there is a question about any claimant having difficulty in pursuing a claim over the telephone, we will establish that early and always make alternative arrangements such as home visits or face-to-face meetings. Although we are also tackling benefit fraud, our objective throughout is to ensure that we pay the right benefits to the right people at the right time.

Occupational Pensions

David Heathcoat-Amory: What recent estimate he has made of the number of defined-benefit occupational pension schemes in which the liabilities exceed the assets.

Mike O'Brien: On the Pension Protection Fund's assessment basis, 5,000 schemes.

David Heathcoat-Amory: The final salary schemes in the private sector have been shutting for many years as unaffordable. The decline in the investment market has made many more extremely vulnerable. Does the Minister believe that the Pension Protection Fund, which he has just mentioned, to which vulnerable schemes have to contribute, is adequate to fund possible insolvencies in the years ahead?

Mike O'Brien: The Pension Protection Fund is best placed to make an assessment of the adequacy of the amounts that it needs, and it has done so and levied accordingly.

Benefit Simplification

Willie Rennie: What recent progress his Department has made on the simplification of benefits.

Stephen Timms: Simplification is essential to reform. For example, the local housing allowance, rolled out from April, has simpler and clearer rules than the previous housing benefit system. Last month, following successful pilots, we agreed with the Local Government Association on a simpler approach to claims when starting a job. From October, two current benefits—incapacity benefit and income support on health grounds—will be replaced by one: the new employment and support allowance. Those are all examples of simplification.

Willie Rennie: I recognise that some progress has been made on simplifying the benefits system, but much more needs to be done. Will the Minister investigate the case of my constituent, Sara McGlynn, who is suffering because she is not ill enough to earn an invalidity benefit? She has not earned enough in the past, because she is too young and does not receive incapacity benefit, and as her partner earns just above the minimum income level, she does not receive income support. Will the Department investigate the case so that complexity does not rule out that person's receiving Government support?

Stephen Timms: I am happy to consider the details of that case if the hon. Gentleman will forward them to me. However, it does not sound to me like a problem of complexity. The system has been effective in increasing employment—we have more people in work in Britain today than ever before, and that is partly the result of the success of welfare reform. However, I agree that simplification is important. For example, we will explore further the idea of a single working age benefit, which would be a radical simplification and would perhaps partly deal with the case of the hon. Gentleman's constituent. I repeat that I am happy to look at the details of the case.

David Kidney: Will the Minister consider simplifying the double benefit rules, especially regarding carer's allowance and the state retirement pension? Will my right hon. Friend be willing to examine that rule, which is of long-standing concern to pensioners? I am sure that the designers of the welfare state in the 1940s could not have expected so many pensioners to be carers for other pensioners—whether spouses or elderly parents. It is a shock to the system to find that, when they receive state retirement pension, their carer's allowance stops.

Stephen Timms: My hon. Friend is right to make the point that people are often concerned when they get into that position and discover that that is the rule. He will know, however, that it is a long-established principle of the benefits system that we do not pay two benefits in those circumstances. I cannot hold out for him the prospect that that will change imminently. However, he will know of the carer's premium in pension credit, which is helping to address the problem that he rightly highlights, and we will of course see whether there is more that we can do.

Peter Bone: A number of my constituents have come to me and complained that their incapacity benefit was stopped after a medical and that, although they then went to appeal and won the case, they experienced a huge delay before their benefit was restored. If that benefit can be stopped immediately, why can it not be started again?

Stephen Timms: When an appeal is successful, benefit should come back into payment very quickly. Again, if the hon. Gentleman wants to draw my attention to any particular problems, I should be happy to look into them; however, anybody who experiences a delay will have their arrears paid in full.

Defined-benefit Pensions

David Amess: What estimate he has made of the number of defined-benefit pension schemes which are open to new members.

Mike O'Brien: About 2,400 defined-benefit pension schemes remain open to new members.

David Amess: Given the Prime Minister's disastrous decision in his first Budget as Chancellor of the Exchequer in 1997 to raid pension funds to the tune of £5 billion, does the Minister share my concern that the take-up in defined-benefit pension schemes has dropped by 1 million in the past year and that, as I understand it, about 4,000 schemes have closed? If the Minister shares my concern, what are the Government going to do to address the present parlous situation?

Mike O'Brien: The hon. Gentleman will be aware that pensions are for the long term and that investments go up and down. Therefore, deficits appear in schemes at different times, which sometimes go into surplus. Such changes occur. The only people immediately at risk would be those in a scheme where the employer moved into insolvency and there was a significant deficit. That is why the Pension Protection Fund has been set up. I remind the hon. Gentleman that the Government have restored confidence in pensions, not only by setting up the PPF, which ensures that people have a kind of insurance scheme, and creating the regulator that oversees risk in the pensions market, but by sorting out the financial assistance scheme and ensuring that those 140,000 people got justice. We are in the process of restoring confidence in pensions—a confidence that was seriously damaged by his Government.

Post Office Card Account

Mark Pritchard: If he will make a statement on the tendering process being undertaken by his Department for the new Post Office card account.

James Plaskitt: I was under the impression that the question had been withdrawn, but I am pleased that the hon. Gentleman is here.

Mr. Speaker: The Minister is right. However, because the hon. Gentleman arrived in the Chamber before his question was called, I used my discretion. My apologies to the Minister.

James Plaskitt: I am delighted that the hon. Gentleman is here. The tendering process is that which is set down by law. It commenced in May 2007, with the publication of the official contract notice, and is proceeding in accordance with the established timetable. In accordance with the rules, the process is being led by officials. Ministers are not directly involved. An announcement on the successful bidder will be made as soon as possible.

Mark Pritchard: I am grateful for your generosity, Mr. Speaker; I did not expect to be in the Chamber at this time. I am glad that I am and that the Minister cannot get off the hook that easily. Given that the Government have basically decimated post offices in Shropshire, not least in my constituency, closing Sambrook, Church Aston and King Street, Wellington, will the Minister give an undertaking, not only to post offices in Shropshire but to those throughout the country, that the tender process will be transparent, open and fair, and will allow those postmasters who want to continue to provide this service every opportunity to do so?

James Plaskitt: The process will certainly be fair, because we are scrupulously following the strict rules laid down by the Public Contract Regulations 2006. If the hon. Gentleman cares to study those regulations, he will see that the process is led by officials and that Ministers are not involved. I cannot therefore give him any reassurances about the outcome, and it would be inappropriate for me to make any comment about any potential bidder. At this stage, I know that the Post Office is a bidder because it has publicly said so. I am unaware of who the other bidders are, however, and that is as it should be. As I have said, the process is being led by officials, and there will be an announcement as soon as we can make one.

Topical Questions

Andrew Gwynne: If he will make a statement on his departmental responsibilities.

James Purnell: Employers have a key role to play in helping us to reach our aspiration of an 80 per cent. employment rate, which is why we have developed our local employment partnerships. The partnerships are flourishing and by the end of last month more than 2,800 employers had recruited through the partnerships, providing work for nearly 13,000 people. I am pleased to be able to report that the number of jobs coming through the programme is increasing week on week and that, in the last week of June, for the first time ever, more than 1,000 people found work through the partnerships in a single week.

Andrew Gwynne: I very much welcome what my right hon. Friend has just said, but does he agree that one of the best ways of tackling future pensioner poverty is to encourage today's workers to save for their future, and that it is therefore potentially damaging for employers to pressurise their employees to opt out of existing company pension schemes?

James Purnell: My hon. Friend is absolutely right, and we are reforming pensions exactly so that people will be automatically enrolled into a company pension or a personal account. That is also why it will be compulsory for employers to match employees' contributions, and why we are taking powers in the Pensions Bill to ensure that employers cannot act in the way that my hon. Friend describes. Any employer who sought to dissuade people from joining a personal account could be fined and might have to pay back the money that people have missed out on as a result.

Philip Hollobone: Does the Minister recognise the depth of concern among my constituents in Kettering and across the country about the potential loss to Post Office Ltd of the Post Office card account? Given that 4 million people a week access their benefits through their local post office branch, and that those transactions bring about £200 million a year to the post office branch network, what weight will be given to those factors when the Government make their decision on the successor account?

James Plaskitt: Information about the account is available in the tendering document, and if the hon. Gentleman studies it, he will see that we are explicitly calling for whoever provides the contract to be able to do so in at least 10,000 outlets and for it to have national coverage. We have also said repeatedly that if any benefit recipients or pensioners wish to access their benefits or pensions in cash at a post office, they will continue to be able to do so.

Linda Riordan: The Pensions Bill will provide a welcome transformation in UK pensions, with its automatic enrolment and compulsory employer contributions. However, may I urge the Minister to make a firm commitment now to introducing index-linked pensions by the end of this Parliament?

Mike O'Brien: The Government's position on restoring the earnings link is that we will do so by 2012 or during the course of the next Parliament. The Government have been very explicit about that. The reason that we enshrined that commitment in law in the Pensions Act 2007 is that it is a fundamental part of our view that we need to restore full confidence in pensions as a whole. If the current operating policies were to continue, the value of the basic state pension would be about £45 a week, and more than 75 per cent. of the pensioner population would end up on pension credit by 2050. We therefore have to reform the system. Uprating the basic state pension by earnings from 2012 will more than double the basic state pension by 2050, compared with its value if current uprating policies continued. The basic state pension earnings uprating, together with other reforms, will mean that about 30 per cent. of pensioner households will be entitled to pension credit by 2050, compared with over 75 per cent. if the present policies continued. The reform is therefore fundamental.

Chris Grayling: We on the Opposition Benches all spotted the Secretary of State carefully positioning himself ahead of a possible Labour leadership contest. How does he think that his decision to make it more difficult for people with disabilities to claim benefits will go down with the people whose support he will need?

James Purnell: The hon. Gentleman is making an imaginary claim; we have no intention of doing that at all. What we intend to do is to help more people into work—providing more support for people but expecting more of people. What we have been doing for the past 10 years is creating an active welfare state, whereby people are required to do more but they get more in return.

Chris Grayling: Well, "breathtaking" is all I can say. Let me quote for the Minister his own Department's equality and impact assessment of the decision to cut the time that is available to make a claim:
	"In particular, customers who have mental health impairments or communication difficulties may not always be in a position to make their claims within the 3 month period, because they are not aware of the existence of these benefits or fail to understand the process for making a claim (due to the nature of their impairment), and have no one to advise or assist them."
	Why, therefore, is his Department taking decisions that will disadvantage some of the most vulnerable people in our society?

James Purnell: We want to help more people to claim the benefits, which is exactly why we are making claiming automatic, why we are going to make it possible to claim the benefit in one telephone call, why Age Concern and Help the Aged support the package that we have brought in, and exactly why for housing benefit as well we have reduced significantly—by half—the time that it takes to claim. That is why we think that a three-month backdating process is exactly right. It is exactly the right way of helping people—ensuring that they can claim their benefits quickly, and getting them more help when they need it.

Julia Goldsworthy: My constituent is seeking repayment of benefits that she was entitled to but did not receive as a result of an inaccurate assessment last autumn—undertaken without interviewing her. Inverness special payments team received her case in March, but the team tell me that, as of 27 June, they were processing claims received in October 2007. My constituent faces a nine to 12-month delay in having her case processed. What is the Minister doing to tackle that delay, and what assurances can he give that those who experience most hardship will not face further difficulties as a result of the Government's maladministration?

Mike O'Brien: I am more than content to meet the hon. Lady to discuss that case. It is obviously important that we resolve those matters properly and as quickly as the administrative system reasonably can, so if she wishes to let me have the case details, I shall happily meet her to see what can be done to help resolve it.

Gordon Prentice: The Minister, the Member for Warwick and Leamington (Mr. Plaskitt), told us a few moments ago that the tendering documents for the Post Office card account would stipulate that it would have to be available in a network of 10,000 post office branches. Given that the shrunken number of branches under the Government's proposals will be 11,500, why stipulate a number smaller than the post office network for which the Government are aiming?

James Plaskitt: The document, which I have in front of me, actually says around 10,000 outlets, and it is of course perfectly in order for any company submitting a tender to offer the service in more than—substantially more than—10,000 outlets if it wishes to do so.

Edward Timpson: The Secretary of State may be aware that although Department for Work and Pensions employees in Crewe are to be re-housed in an extensive new building, staff at Her Majesty's Revenue and Customs in Crewe face job losses as a result of HMRC's wish to downsize its estate and the staff's inability to travel to Stoke-on-Trent by public transport, owing to time, distance and the adverse effect that it would have on their families and children. Is there not some potential for joined-up government, or for any extra capacity in the new DWP building in Crewe to be used to re-house the HMRC staff?

James Purnell: The hon. Gentleman makes a good point. We are working closely with HMRC and conducting pilots to see how we can co-locate HMRC and DWP employees. Work is being done in a number of local authorities, and we are looking to roll it out, so I would be happy to discuss with the hon. Gentleman how it might be done. However, we have reduced by 30,000 the number of people who work in the DWP. The Office for National Statistics recently said that that represented a 20 per cent. increase in our productivity, and I am sure that the hon. Gentleman agrees that, if we can provide the same or a better service for less money, the taxpayer will welcome it.

Henry Bellingham: In an interview in  The Times, the Secretary of State said that nobody had a right to benefits. He went on to say that unemployed people could have their benefits stopped for up to six months if they did not co-operate in looking for a job, that sick and disabled people would be expected to work if they were physically able to do so, and that drug addicts who refused treatment would be stripped of welfare support. Those are draconian proposals. Has the Secretary of State discussed them with the MSP Margaret Curran, and will they apply to the residents of Glasgow, East?

Mr. Speaker: Order. The hon. Gentleman is totally out of order.

Henry Bellingham: The first part was in order.

Mr. Speaker: The first part might have been, but the hon. Gentleman should have known that that was the only part that was in order.

James Purnell: We want to provide more support for people to get back into work, and that is exactly why we are making sure that everybody can have access to pathways. However, we will also expect more in return; that will mean more people getting back into work. People do not have a right to a life on benefits if they can work. I would have thought that the hon. Gentleman agreed.

David Gauke: In 1997, Labour was elected on a platform of welfare reform and getting people off benefits and into work. Eleven years on, there are parts of this country, including parts of Glasgow, where 50 per cent. of people of working age are on out-of-work benefits. Is it not clear that the Government have failed in certain parts of the country to get people off benefits and into work, and that they have let down the people of Glasgow, East?

Mr. Speaker: Order. I say again that topical questions are not for questions about by-elections; those are for the candidates out there. [Hon. Members:"Labour has not got one yet. "] Well, that is another point.

James Purnell: Since 1997, the number of unemployed people has gone down by 50 per cent. In Glasgow, the number has also gone down by 50 per cent. The number of people on incapacity benefit is down by 25 per cent. I recently visited Glasgow and spoke to Steven Purcell, who, with the Commonwealth games coming, is bringing in a fantastic programme with an offer of apprenticeships for all young people. That is in sharp contrast to how the Tories ran down that city and abandoned people when they were in power.

David Taylor: Can the Secretary of State give the House a concise and precise report on the state of play with the Child Support Agency? I am not sure whether my experience is typical, but after a long lull, I am now seeing a substantial spike of new cases and new reports of incompetence in that organisation.

James Plaskitt: I can give my hon. Friend the broad picture, which is one of improvement, notwithstanding what he has said. We are implementing the operational improvement plan, as a result of which the agency has collected £1 billion in maintenance for the first time since it was established. Furthermore, thanks to that improvement plan, 200,000 more children are now being supported by £200 million more of maintenance payments.
	At the same time, the agency is making progress on reducing the backlog of cases. The new scheme backlog has dropped from more than 200,000 to about 100,000 and the old scheme backlog has dropped from 65,000 to 27,000. All that is progress, although it does not mean that the agency is yet performing perfectly. We all know that there are still difficult and problematic cases. If my hon. Friend has particular cases on which he wants further assistance, I shall be happy to meet him about them. However, the overall story is one of steady improvement.

Peter Bone: A number of my constituents on incapacity benefit have claimed that the Department for Work and Pensions has asked them to go for a medical and that their benefits have then been withdrawn. They have then gone to appeal and had them restored. How many such people have been required to go for medicals, how many of them have been taken off incapacity benefit and how many have had their benefits restored on appeal?

Stephen Timms: The hon. Gentleman has already raised that matter, and I have said that I will happily look at the examples to which he has referred. It is, of course, right that there should be tests once somebody is in receipt of incapacity benefit. Increasingly, we want people who are able to move back into work to do so. Medical interventions can assist with that. People can be pointed towards help and assistance—drawing on the access to work programme, for example—in order that they can move back into work. That will be a stronger feature of the new employment and support allowance than it is of the current arrangements. If there are particular difficulties in the hon. Gentleman's area with delays once appeals have been won, I would be happy to look at them.

David Kidney: A few minutes ago, the Secretary of State spoke about the co-location of Jobcentre Plus and Her Majesty's Revenue and Customs staff. How innovative is he prepared to be on co-location, as other people provide services that must also be complementary to Jobcentre Plus? I am thinking of physiotherapists and health workers in order to get people ready for work; and of job trainers, job searchers and skills trainers, all of whom—whether in the public, private or very important voluntary sector—could work complementarily with Jobcentre Plus staff if they were co-located.

James Purnell: We are prepared to consider anything that will improve the service. My hon. Friend is absolutely right that others could be brought into job centres. In the pilots, for example, we already work with people from local authorities. It may also mean our Jobcentre Plus advisers, who do a fantastic job, going into other locations. I recently visited a doctor's surgery in South Shields, where we have a Jobcentre Plus adviser who is helping people to get back into work, where I was told that inactivity is itself a cause of ill health, and where there was already good evidence that having Jobcentre Plus advisers working side by side with GPs could improve people's health while reducing unemployment and inactivity.

Bovine TB

Hilary Benn: With permission, Mr. Speaker, I wish to make a statement about the Government's plans for tackling bovine TB in England. In doing so, I would like to thank the Select Committee on Environment, Food and Rural Affairs both for its comprehensive and thoughtful report and for allowing me additional time to respond to it, which I have now done. I am also grateful to Professor Bourne and the members of the Independent Scientific Group for their thorough scientific study.
	Bovine TB is not a new problem. For more than 70 years, successive Governments have implemented cattle controls based on surveillance, testing and the slaughter of reactors. Those have been designed to protect public health, reduce the economic impact of the disease on farmers and, more recently, to comply with our obligations under European legislation. By the mid-1970s, the incidence of TB in cattle had reached an all-time low. However, since the 1980s, disease incidence has increased again—with a significant rise following the 2001 foot and mouth epidemic—and last year, nearly 3,200 new TB incidents were recorded and 18,543 reactor cattle were slaughtered in England.
	Bovine TB is a serious problem, particularly in the south-west and the midlands. Although more than 90 per cent. of herds are TB free at any one time and some significant cattle farming areas are largely without the disease, I know from listening to farmers living with it just how difficult it is, and, for those most seriously affected, I know that the economic and human consequences are simply devastating. That is why we should take the right decisions to help.
	Bovine TB is transmitted between cattle, and between cattle and badgers, but what has dominated the debate is whether badger culling could be effective in controlling the disease. The 10-year randomised badger culling trial overseen by the Independent Scientific Group on cattle TB, culled some 11,000 badgers to discover what impact it would have. The ISG's final report, published last year, concluded that reactive culling—killing badgers in areas where there had been local TB breakdowns—made the problem worse; and that proactive culling, which involves taking an area of about 100 sq km and repeatedly culling badgers over a number of years, produced only marginal benefits because although TB was reduced in that area, it increased outside of it because of the disturbance and movement of badgers.
	While scientists agree that a prolonged and effective cull over even larger areas—some 250 to 300 sq km—could reduce the incidence of bovine TB, the ISG's judgment was that the practicality and cost of delivering a cull on that scale meant that
	"badger culling cannot meaningfully contribute to the future control of cattle TB".
	Having listened carefully to a wide range of views from scientists, farming, veterinary and wildlife organisations, and many others, and having considered all the evidence, I have decided that although such a cull might work, it might also not work. It could end up making the disease worse if the cull was not sustained over time or delivered effectively, and public opposition, including the unwillingness of some landowners to take part, would render that more difficult. It would not be right to take that risk. Therefore, in line with the advice that I have received from the Independent Scientific Group, our policy will be not to issue any licences to farmers to cull badgers for TB control, although we remain open to the possibility of revisiting that policy under exceptional circumstances, or if new scientific evidence were to become available.
	This has been a difficult decision to take, and I know that farmers affected will be disappointed and angry. We all want the same thing—to beat this terrible disease—but I have had to reach a view about what will be effective in doing so, guided by the science and the practicality of delivering a cull. Having made a commitment to farmers and others that I would take a decision, now that it has been made, we need to put all our efforts into working together to take action that can work in all affected areas.
	I have therefore also decided to make vaccination a priority, as recommended by the Select Committee. Effective vaccines could in future provide a viable way of tackling disease in both badgers and cattle. We have invested £18 million in the past 10 years in vaccine development, which has delivered good results, including: evidence that vaccinating young calves is effective; making progress towards developing a test to distinguish between infected and vaccinated cattle; showing that injectable BCG can protect badgers; and developing oral badger vaccine baits. I now intend to increase significantly our spending on vaccines by putting in £20 million over the next three years to strengthen our chances of successfully developing them. I will also provide additional funding to set up and run a practical project to prepare for deploying vaccines in future.
	It could be some time before an oral vaccine for badgers, or a cattle vaccine, becomes available, so for now we must reduce the spread of the disease, and try to stop it becoming established in new areas. We have cattle controls in place to tackle TB, and have strengthened them in recent years with the introduction of pre-movement testing and the targeted use of the more sensitive gamma interferon test. But the action that individual farmers take, in particular to deal with the risk of importing disease into their herd, will also remain critical.
	Disease control is not just a matter for Government, notwithstanding the considerable cost. Farmers have the main interest—the burden of controls falls most heavily on them—and they must be involved in working out how we go forward. It would be possible to tighten cattle measures still further as recommended by the ISG report, but that would come at a high cost. Whether it would be worthwhile is as much, if not more, a question for the industry as it is for Government. There is a choice to be made. That is why I have decided to set up a bovine TB partnership group with the industry to develop a joint plan for tackling bovine TB. We will discuss with the industry who should be on the group and how it should work, and I want to get started as quickly as possible.
	The group will have full access to information on the TB budget and will be able to make recommendations about its use. It will be able to propose further practical steps to tackle the disease, including, for example, whether there should be tighter cattle controls. It will help to reach decisions about the injectable vaccines deployment project. It will be able to look at ways of helping farmers to manage the impact of living under disease restrictions, for example by providing incentives for biosecurity, or maximising the opportunities to market their cattle by looking again at the restrictions around red markets and encouraging the establishment of more exempt and approved finishing units. I am prepared to make additional funding available to support such initiatives if the group makes a strong case for doing so.
	The House is united in its determination to overcome bovine TB, and much as we would all wish it, there is no quick or easy way of doing so. But our best chance is to work together, and I therefore hope that the industry will respond to my proposals so that we can get on with it.

James Paice: I thank the Secretary of State for his statement, and for allowing us prior sight of it. I also congratulate the Environment, Food and Rural Affairs Committee on its report.
	This is the Government's response to a consultation on badgers that began three years ago. Never have three years produced so little substance. Can the Secretary of State explain why he waited until the day after the royal show before making his statement, given that its contents were widely known during it? Was the reason that he did not wish to upset farmers before he attended?
	Given that Lord Rooker has said that the EFRA Committee report was "absolutely first-class", that the "buck stops here" and that
	"the present situation is unsustainable",
	and given the widespread rumours of threatened resignation, can the Secretary of State assure us that his statement has the full support of his ministerial team in both Houses? Will he also confirm that since 1997 more than £600 million has been spent on combating the disease and 200,000 cattle have been slaughtered—for what benefit?
	In that time, as the Secretary of State has said, the Government have produced just two initiatives, pre-movement testing and gamma interferon. Last year another 28,000 cattle were slaughtered, and perhaps the Secretary of State will confirm that according to figures for the period up to the end of April we are on course to slaughter 40,000 this year. There have been more than 1,400 new incidences this year, and nearly 5,500 herds were affected at the end of April. What would the Secretary of State say to a farmer to whom I spoke recently, who had just had a number of pedigree cattle taken? Yes, she had been compensated, but her complaint was about the waste of good cattle and taxpayers' money, and about the fact that we were getting nowhere.
	The Secretary of State referred to the budget. Is he now able to answer the questions to which he has so far been unable to provide written parliamentary answers? How much is he planning to spend on TB in each of the three years of the current comprehensive spending review, and what is the projected number of cattle to be slaughtered in the setting of those budgets? If the number does rise to 40,000 or more, how will he accommodate that—or will he cut compensation further? According to Department for Environment, Food and Rural Affairs' 2004 paper "Preparing for a new GB strategy on bovine tuberculosis", the annual costs will rise to more than £300 million by 2012-13. Is that still the Secretary of State's estimate?
	The Secretary of State obviously pins his hopes on vaccines—rightly, in some ways—but his predecessors have done the same. In 1998 the Government had a five-point plan, one of whose points was "developing a vaccine". In 2003, the right hon. Member for Scunthorpe (Mr. Morley) said
	"The development of a TB vaccine is one of the key objectives of our TB research programme."—[ Official Report, 1 April 2003; Vol. 402, c. 638W.]
	In 2005, the right hon. Member for Derby, South (Margaret Beckett) announced a 10-year framework, which stated
	"We will actively continue with vaccine research looking at options for both badger and cattle vaccines."
	Can the Secretary of State tell the House how many cattle he expects to be slaughtered annually by 2013, even if an oral vaccine is available then, and how much of England he expects to be infected? Is it not the case that, given a public service agreement to limit the spread of the disease to no more than 17 new parishes this year, the Government have effectively given up on any hope of control?
	The Opposition have consistently called for a comprehensive package of measures to combat this disease. We do not believe that simply targeting badgers is the solution, but even Professor Bourne has said that the disease cannot be eradicated unless the wildlife reservoir is addressed Let me therefore ask the Secretary of State some questions about the components of such a package.
	Now that pre-movement testing has been in place for two years, is the Secretary of State satisfied that it is cost-effective, and that farmers are not moving stock without tests? While we welcome the extra resources for vaccine development, given his predecessors' commitments, how much more quickly does he expect it to produce results? What steps is he taking to examine other factors, such as the role of maize and possible trace element deficiencies in the spread of TB? Does he believe that the current frequency of testing is adequate, especially in areas that are adjacent to infected areas? Let me also ask him about the European context. Is it not the case that we are required to have a programme to eradicate TB? Has he discussed his statement with the European Commission to establish whether the Commission believes that his proposals have any hope of success?
	The Secretary of State has set up yet another new study group. Have not the industry and most vets already told him what should be in the plan? What powers will the group have to do anything? He spoke of more money being available. Will he tell us how much, and where it will come from?
	The right hon. Gentleman, as he said, has declined to control badgers and, in doing so, has gone against not only the demands of farmers but the recommendation of the Select Committee, the advice of Sir David King and even the evidence collected by the ISG. [ Interruption.] It is true. Did not that evidence show clearly that removal of badgers in hot-spot areas caused a reduction in incidence and, most importantly, has not the continued monitoring of those areas since the final report now shown a reduction in incidence in excess of 50 per cent.? Would not the suggested area in north Devon have been an opportunity to run a selective removal programme, either using local knowledge—as the proponents suggest—or to validate the use of the PCR—polymerase chain reaction—test to establish whether setts contain infected animals? If it can be shown that removal was primarily of infected animals, would not that make it more acceptable and in the interests of badgers as well as cattle? I know that some of the right hon. Gentleman's advisers will say that the PCR test is not sufficiently accurate, so why is he content to slaughter thousands of cattle using a test with a sensitivity of only 80 per cent.?
	Nobody wants to remove large numbers of badgers but the Secretary of State cannot deny that this is also a disease that affects them. Badgers with TB die a nasty, lingering death. They are evicted from their family setts and wander around the country spreading the disease. Surely it is in the interests of a healthy badger population, as well as a healthy cattle population, that we tackle the disease from all angles. It is clear from the statement today that the Government are not prepared to do so.
	Some three weeks ago, the farming press carried a comment by me about the Secretary of State, in which I said that he is a nice man who has failed to deliver. I am grateful to him for proving my point.

Hilary Benn: First, I am happy to confirm that the statement represents the Government's policy on what we should do. The hon. Gentleman did not really respond to the question about badgers and the evidence. I disagree with his interpretation. In the end, it is no good taking a decision to allow something to happen that might not deliver the desired effect. The ISG report came as a great surprise to lots of people, as the hon. Gentleman will be only too well aware, and Professor Bourne made clear that what it found was counter-intuitive. But in the end the ISG's conclusion was, and I repeat it, that badger culling cannot meaningfully contribute. I have listened very carefully to that advice and have formed my judgment. I remain very clear in my view that it is the right decision to take.
	Secondly, the budget will depend on the progress of the disease, so it is not possible to give a forecast of the spend. It will depend on what happens, and the same is true for any forecast about the number of cattle that might be slaughtered. If the hon. Gentleman looks at the figures for England over the last five or six years, he will see that the number has gone up and down during that time. Investment in vaccines will give us greater prospect that a usable vaccine will be found and, in the end, we need to focus our effort on something that will enable us to deal with the problem of bovine TB in all the areas where it is to be found. Even those who advocate selective culling would recognise that that is not a policy that would work everywhere. We have absolutely not given up on control, and the PCR test is not capable of being used in the way that the hon. Gentleman described it.
	On the effectiveness of our current measures, these are precisely the questions that I want to put, but not to another "study group." The hon. Gentleman will be aware of how we have worked with the industry in tackling bluetongue, and that has been a successful partnership group. Why? Because we have sat down together, put the problems on the table, shared the responsibility and taken decisions accordingly. That is exactly the model that I wish to use now that I have taken a decision about badger culling.
	The hon. Gentleman asked about Europe. I am happy to tell the House that I spoke to the Commissioner earlier this afternoon.

Gavin Strang: I thank the Secretary of State for his statement and his response to the Select Committee report. Does he accept that bovine TB is the biggest challenge facing our livestock sector? Over the past five years up to last March, it has cost the Government well over £400 million, and in addition there is the huge commercial cost and the misery and suffering resulting from herd breakdown. Will the Secretary of State say a little more about not only cattle-to-cattle spread, but herd-to-herd spread?

Hilary Benn: I agree with my right hon. Friend about the impact of the disease and the effect it has on the farmers who are suffering as a result of it. We need to take all the measures that the evidence says will work and which are effective in dealing with the problem. That is why we have made changes in recent years, including bringing in the pre-movement testing which began for animals over 15 months of age in March 2006, and then extended to all cattle aged over 42 days. The straight answer is that it is probably still too early to tell exactly what the impact of that has been, which is why we must continue to monitor. It is important that we maintain the controls we have in place, and have an honest conversation with the industry about whether further cattle controls is the right step to take. I think it is right and proper to ask the industry what its view is precisely because of the impact on farmers, as opposed to me standing before the House today and saying that I have decided to impose those controls myself.

Michael Jack: I thank the Secretary of State and the Opposition Front-Bench spokesman for their kind words about the Environment, Food and Rural Affairs Committee's report. However, I must tell the Secretary of State that as a result of what he has said today there will be anger in the hot-spot areas and there will be fear in those areas where TB has yet to arrive. He said nothing in his statement about epidemiology. What steps will he take to address once and for all the question of how the disease is transmitted, for without that understanding there can be no effective biosecurity measures, and what specific proposals does he have to help farmers, particularly in the hot-spot areas, deal with biosecurity measures at a time when the livestock industry is under great financial pressure?

Hilary Benn: I know there will be anger—indeed, I referred to that in my statement—because I know how strongly lots of people on both sides of the argument feel about the issue. However, in the end I have to follow what the science says and make a judgment about the practicality and effectiveness of a course of action, and that is what I have done. The group that I will establish will look at precisely the question the right hon. Gentleman raised, including what further steps might be taken to support farmers in providing biosecurity and also including better evidence. I agree that it would be good to understand better the precise means of transmission, but all I can say to him on that is that, as his Committee's report set out very clearly, we still do not know quite a lot and it is important to continue with research to try to find the answers, but it is even more important that we make sure that effective controls are in place.

Roger Williams: I should like to thank the Secretary of State for giving me an early sight of his statement. I also wish to draw attention to my declaration of interests in the register, and to say that the farming business for which I have a responsibility recently underwent a tuberculin test and three cattle were found to be reactors and the results for 11 were inconclusive. That is the first time that that herd and that farm have experienced TB for more than 50 years.
	I commend the Secretary of State for one thing this afternoon: that he has come to a decision. It is difficult to know, however, whether that decision was made on the grounds of populist appeal or sound science.
	Following the Bourne report, Sir David King propounded a larger scale cull to overcome the reservations of Bourne's conclusions, but the Secretary of State has completely ignored Sir David King's views. The EFRA Committee suggested a pilot large-scale cull, possibly in the south-west, to test Sir David King's views, but the Secretary of State has also ignored its recommendations.
	The Secretary of State says that further evidence may reverse the decision on culling. Where does he see that evidence coming from, and what research has he commissioned on that? The right hon. Gentleman says he will invest more money in vaccine development, yet the Select Committee was given evidence that the limiting factor in vaccine development is time, not resources. He says that some landowners may not have supported the badger cull, but how many farmers will support the proposed bovine TB partnership group when they feel so let down and demoralised at the moment? With outbreaks of bovine TB increasing rapidly, what will the cost to the country be over the next three years? Will the Secretary of State revisit the compensation payments for pedigree and highly valuable stock?
	The situation of the farming industry and the Government is very sad, and no one would wish to cull wild animals for the sake of it. But the role of badgers as a reservoir for TB infection is unquestioned, and the Secretary of State has no answer on how to eliminate it.

Hilary Benn: I agree with the hon. Gentleman when he describes the situation as very sad, and I am sorry to hear about the effect on his herd. However, the answers were not based on populism: they were based on an assessment of the science. I assure him that I ignored nothing. I apologise to the House for having taken a year to reach a decision on this issue, but I took the responsibility placed on me very seriously. I have looked at all the evidence and I have talked to all those who have a view.
	Sir David King looked at the science and said what the effect would be if we met all the conditions. By his own acknowledgement, he did not consider the practicality. In reaching a decision, I am bound to consider both the science and the practicality. Self-evidently, if all the badgers were, for the sake of argument, to be culled—[ Interruption.] I know that no one has argued for that, but my point is that the science only takes us so far. I also have to consider practicality and effectiveness, and whether a cull could be delivered. My judgment is that it might not work in those circumstances. The evidence base is strong, because the one substantive bit of evidence that we have about the impact of culling is the randomised badger trials, which were carried out over 10 years.
	I met the teams who are working on the vaccines about six weeks ago. The advice that I have received is that putting more money in will help to improve the likelihood of getting a successful vaccine, but will not of itself speed up the process. On the issue of compensation, we are awaiting the outcome of a judicial review, and it would be prudent to see what that judgment is. How many of those in the industry will support the group that I am establishing? I hope that people will support that group, because whatever the anger, disappointment and other strong feelings that they will have about the decision that I have made—and announced to the House today—the disease will remain, we will have to deal with it, and we will be able to do that only by working together.

David Drew: I thank my right hon. Friend for listening to the totality of the ISG report, rather than picking parts of it. I also thank him for ignoring the former chief scientist, because some of us have grave doubts about the part that he played and the way in which he chose to reinterpret the evidence. Will my right hon. Friend say something more about the vaccination programme? He will know that I have part of it in my constituency. As much as time and money are of the essence, surely there is a need to test the vaccines in several different places and ways so that we can find the solution—and the only solution is vaccination—as soon as possible?

Hilary Benn: I thank my hon. Friend for his words, although I must point out that I have not ignored anyone's opinions, including those of Sir David King, but considered them all extremely carefully. There is a three and a half year injectable badger vaccine field trial under way, and work is also going on to develop an oral bait. The demonstration project, which I wish to work with the new partnership group to put in place, is intended to build confidence in the industry in the potential of vaccines to help to deal with the problem.
	In the case of a cattle vaccine, which is a bit further away, the first requirement is for an effective DIVA—differentiation of infected versus vaccinated animals—test to distinguish between infected and vaccinated animals. Secondly—and this will be an issue that the House will need to address—European legislation forbids the vaccination of cattle to deal with bovine TB. If and when we get a vaccine and a satisfactory DIVA test, I would hope that the whole House would think it sensible to argue the case for vaccination as a better way to deal with this disease in the medium to long term than culling, of cows or badgers—when the science shows that that could make things worse.

Geoffrey Cox: Farmers in the intensely infected area of Devonshire that I represent will regard this decision as a spineless abdication of responsibility. Why, if the considerations that the Secretary of State has taken into account are so compelling, have the Welsh Executive decided to pilot a trial of just the type that the Select Committee on Environment, Food and Rural Affairs, on which I have the honour to sit, has recommended to him?

Hilary Benn: With respect to the hon. and learned Gentleman, I do not accept that characterisation of my decision. The Welsh Assembly Government have made their own decision and of course I considered that. I weighed very carefully in my mind what the Select Committee had to say. It was an outstanding report, but, in all honesty, I formed the judgment that I have, which I have told the House about today. The judgment had to be made about whether, in the light of the science, it was worth taking the risk when one could not guarantee that a cull on such a scale could be sustained given the strength of feeling about the question on both sides of the argument. That was the judgment that I formed and the decision that I took.

Charlotte Atkins: Representing as I do a hot-spot area, I know that many farmers will be disappointed by this decision. May I invite the Secretary of State to visit a hot-spot area such as mine to discuss with farmers a number of issues, including the level of compensation for farmers, particularly those with pedigree animals at risk, and biosecurity measures, as we have had a huge increase in the number of badgers in farms? How will he monitor the cull in Wales and draw lessons from it so that we learn from that initiative?

Hilary Benn: On my hon. Friend's last point, the Welsh Assembly Government have announced that a cull in one area is intended to form part of their intensive treatment programme. We do not yet have any details about where that would be or how it would be undertaken. Of course, I will look carefully at the effect of that. That is why I said in my statement that we would revisit the decision if the scientific advice changed.
	I am always happy to visit and to talk to farmers. At the royal show on Friday I talked to a couple from Devon who have been badly affected by bovine TB. I have visited a farm as part of the process of gathering evidence and views in order to take the decision. We will, as I indicated earlier, have to work with farmers in all parts of the country, particularly in the hot-spot areas, to find effective ways of dealing with the problems that they are experiencing.

Angela Browning: Having been a member of the Government who set up the original Krebs inquiry, I was disappointed that Krebs did not take into account the work done in the Republic of Ireland by the East Offaly project. The Secretary of State says today that proactive culling gives only limited benefit, but why has he not looked more closely at trials in places such as the Republic of Ireland and modelled his project on well-researched and long-established work done just across the Irish sea?

Hilary Benn: I have looked at all the evidence. Clearly, the circumstances in the Republic of Ireland are different from those in England. It is true that the Republic has culled badgers. As the hon. Lady will be aware, herd incidence fell from 6.4 per cent. in 2002 to 4.9 per cent. in 2004 in the Republic. It has subsequently risen again to a provisional figure of 6.1 per cent. in 2007. Based on those figures, it is difficult to form a judgment about the impact of culling or other measures that the Government in the Republic of Ireland are taking. I draw the hon. Lady's attention, too, to the experience in Northern Ireland, where, as she will know, there has been no culling. Cattle measures were tightened in Northern Ireland and the herd incidence decreased from 9.9 per cent. to 5.4 per cent. between 2002 and 2007. That tells us just how complex the relationship is between the policies that are pursued and the outcome in terms of disease control.

Eric Martlew: I congratulate the Secretary of State on making the decision, because it must have been very tempting to kick the issue into the long grass and go on holiday. Time will tell whether the decision is right or wrong, but is not the reality that the science did not justify a cull, and that the practicalities make a cull impossible? Many of us believe that the Welsh decision will never be implemented. Does he not think that more money should have been spent on research into a vaccine long before now?

Hilary Benn: I am sure that my hon. Friend will believe me when I say that the easiest decision that I could have taken would have been to announce another study, another review, another piece of work— [Interruption.] No, I could have done that, as opposed to finally taking a decision in light of a 10-year scientific study, in which the Government have invested £50 million, or we could have culled badgers to see what the impact would be. The study is our strongest evidence base from which to work. We have already invested a lot of money in vaccines, and I hope that the House will welcome the fact that I have announced a significant increase today.

Stephen O'Brien: Words will not describe the despair of the farmers in Eddisbury and Cheshire at the uncharacteristically weak and gutless arguments advanced by the Secretary of State today. They will be looking for reassurance that he has a sufficiently open mind to allow them, as an earnest of intent, to volunteer their area as a pilot area, or hot spot, for the removal of badgers to limit the spread. That is a sensible idea, as Cheshire is contiguous with Wales. It would be a good test bed for the same reasons as Wales is, which he hopes to monitor. May I ask him to comment on that?

Hilary Benn: I am the first to understand how the decision will be received by those who think that culling is the right thing to do, but that does not change my decision, because I have weighed all the evidence. In the end, my responsibility is to take decisions to do things that will be effective, and not to take decisions that might result in the disease being made worse. We have an evidence base, on which I have drawn in reaching that view. On whether I have an open mind about the future, I hope that the hon. Gentleman knows me well enough to recognise that I do. I have had to take the decision on the basis of the evidence that we have thus far. That is why I have taken the decision that I have.

Nick Palmer: I thank the Secretary of State for receiving representations from many of us with concerns on the issue, and for taking this courageous decision. He is putting scientists before pressure groups, in contrast to both the main Opposition parties, whose motto in these matters is, "If in doubt, kill something."

Hilary Benn: I thank my hon. Friend for acknowledging that the decision that I have taken is based on the science. This has been an exceptionally difficult issue to grapple with, and an exceptionally difficult decision to take. No matter what has been said in the Chamber today, many hon. Members on both sides of the House recognise the difficulties of the question. In the end, we have to respect the different conclusions that we have drawn, but it does not mean that either of the views taken are wrong in their own terms, and I stand by the decision that I have reached.

David Heath: There will indeed be a great deal of anger among people in the farming communities in the west country, not least among those who, like several of my constituents, run closed farms. There are cases where there has been no cattle movement on or off a farm, and where all the biosecurity measures that can legally be taken have been taken, yet TB has appeared within a dairy herd. They will not know what to do next. May I raise a question, asked by the hon. Member for South-East Cambridgeshire (Mr. Paice) on the Conservative Front Bench, about the welfare of the badger population? We have a large number of badgers in Somerset, and TB is endemic among them. Is nothing to be done to rid the badger population of bovine TB?

Bill Wiggin: They are suffering.

Hilary Benn: The hon. Gentleman talks about the suffering of badgers. As he will be aware, section 6 of the Protection of Badgers Act 1992 allows someone to put down a badger if it is seriously injured or in such a condition that to do so
	"would be an act of mercy".
	That is what the law currently says.
	I understand the frustration felt by those with closed herds, but the evidence from the randomised badger culling trial was that the reaction would be, "I've got a closed herd, there are badgers, it must have come from them, let's cull them." That is reactive culling, and the evidence was very clear that reactive culling makes the disease worse. That may not be what people would assume to be the answer to the question, but it is. A lot of badgers were culled in order to provide that information, on the basis of which I have made my judgment.

Peter Soulsby: I welcome the Secretary of State's measured statement. It is clear that he has considered the overwhelming scientific advice and the conclusions of the Environment, Food and Rural Affairs Committee report. Will he join me in regretting the statement made last week by the National Farmers Union, which described the culling of cattle as a
	"needless waste of productive animals"?
	Does he agree that, while the NFU has a job to do in reflecting the genuine concern and distress of its members, it should not pretend that the culling of badgers is some sort of panacea? It should be well aware of the evidence and therefore know that it should not pretend that there is any realistic prospect of culling doing anything other than making the situation even worse.

Hilary Benn: Nobody wants to cull any animals unless it is necessary. At the moment, the culling of cattle is an important part of the disease control system for bovine TB that we have in place. We have already discussed at some length the evidence regarding the culling of badgers. I agree with my hon. Friend. As I said, we should all want to be able to move to a different way of dealing with this disease. That is why a significant investment in vaccines must be the right thing to do for the medium to long term. As in other areas, as vaccines are developed, we can provide protection without having to resort to culling, and that is surely the way that we should go in future.

Anthony Steen: Devon has been savagely hit by this disease. Many thousands of animals have been destroyed and multi-millions of pounds have been paid in compensation. If the badgers cannot be culled and there is not to be widespread inoculation against TB, what are farmers supposed to do?

Hilary Benn: I accept entirely the difficulty faced in Devon and other hot-spot areas, and I recognise the frustration that farmers feel because they think that culling is the way to deal with the problem. All that I can do is to draw attention to the experience of trying to respond by culling, which can be found in the RBCT report, and to the conclusions of Professor Bourne. That is not what people expected, but it is what was found, and I must act on that judgment. I recognise that it is very difficult. We know that badgers are infected and are a source of infection—no one argues about that. The question is what is the effective way of dealing with it, and the only way to do so currently is to seek to develop a vaccine. That is why one of the things that I want to do, working with the new partnership group, is to develop the vaccine deployment project. Perhaps that could be tried in Devon; I am open to suggestions.

Paul Flynn: The Secretary of State is to be warmly congratulated on his courageous decision, which is evidence-based and science-based. He has taken on the irrational claims of Opposition Members, not one of whom has given any examples of how culling works. It has never worked anywhere. It did not work in Ireland, where there are hardly any badgers left but there is still a high level of TB. Is not the best way forward to attack the real problem—cattle-to-cattle infection—by having farmers insure their own sheep instead of relying on compensation, and to cut down the number of animal movements to markets and shows, many of which are unnecessary?

Hilary Benn: We need to use all the measures that will be effective, including the cattle controls to which my hon. Friend refers, but it will also be important, as I have acknowledged, to find a way of dealing with BTB infection in badgers. The evidence is that culling is not an effective way of doing so; vaccination could be, and I hope that the House will support it.

Richard Benyon: I refer hon. Members to my entry in the register.
	What will be the statistical measure of the success or failure of the Secretary of State's policy: the number of cattle infected or culled, the geographical spread of the disease, or the financial cost? Will he agree to come back to the House if the point is reached, based on any of those three criteria, where it is apparent to the wider public that his policy has failed?

Hilary Benn: I am happy to come back to the House on any occasion to report on the progress made in fighting bovine TB, and to be held to account for that and for any other decisions that I make. However, having formed a judgment that the course of action that some have urged upon me would not help us to deal with the disease, I hope that the hon. Gentleman will understand why I have taken the decision that I have. Why would I want to do something that might make the matter worse, leading to more cattle being culled and more money being spent on compensation?

Frank Field: May I invite the Secretary of State to emphasise that his statement today was not about whether we should kill or not kill animals, but about which animals we should kill? So that we can educate our constituents more fully, will he remind us—for the last period he has easy access to—how many animals were killed, and what the cost of that was to taxpayers?

Hilary Benn: For England, the number of cattle slaughtered in 2007 was 19,800. The previous year it was 16,000; the year before, it was 23,000; the year before that, it was 17,300; and the year before that, it was 17,551. The House will see that the numbers go up and down, depending on the progress of the disease. The total cost of compensation in 2006-07 was £24.5 million, but that is a Great Britain, rather than an England-only figure.

Mr. Speaker: I call Mr. Liddell.

Ian Liddell-Grainger: Thank you, Mr. Speaker. Mr. Liddell at your service.
	Will the Secretary of State accept that the march of TB across Exmoor and into the Levels, which the hon. Member for Somerton and Frome (Mr. Heath) represents, has become absolutely unstoppable? It has got into areas of my constituency that have not seen TB for over a generation, and it is getting worse. Since the Secretary of State has mentioned it twice, will he come down to Somerset and meet some real farmers on Exmoor? They want to know why they should be in livestock production when every time they test their herds, they find TB again, and they go round in a circle of slaughter and re-equipping. Will the Secretary of State meet those farmers?

Hilary Benn: I would be happy to do so. I spend quite a lot of my time meeting farmers, and I am very willing to do so. The Under-Secretary of State for Environment, Food and Rural Affairs, my hon. Friend the Member for Chatham and Aylesford (Jonathan Shaw), has met farmers in Exmoor to discuss the problem.

Angela Smith: I welcome today's announcement that the proposed cull will not be going ahead. I welcome, too, the Secretary of State's commitment to work with the industry and to consider funding practical measures to deal with bovine TB. Recent media reports, however, have suggested that some farmers may be tempted to take the law into their own hands. Will he join me in making it clear that the full force of the law should be brought to bear against anyone who kills badgers illegally?

Hilary Benn: The legal position is extremely clear under the Protection of Badgers Act 1992. I very much hope that no one will be tempted to do what my hon. Friend described, with regard to the controls in place. Whatever the strength of feeling, which I acknowledge, it is important that we keep the current controls in place because they are the best hope that we have of dealing with the disease.

Geoffrey Clifton-Brown: Although the Secretary of State is a very reasonable man, farmers in Gloucestershire, where the hot-spot areas are, will greet his announcement with absolute dismay and annoyance. In the past 10 years, 200,000 cattle have been slaughtered and we may be on course for 50,000 cattle to be slaughtered this year alone. That is a huge cost in human and animal misery, and in financial terms. The Secretary of State said, even today, that a proactive cull with hard boundaries may well produce some results. Why has he rejected that option?

Hilary Benn: Because, in the end, I have made a judgment about the likelihood that such a cull could be successfully delivered. It may be successful, and it may not. I say to the hon. Gentleman that his constituents would not thank me if I pursued a policy that ended up making the disease worse. That has weighed heavily on my mind in taking this decision.

Anne Snelgrove: I sympathise with my right hon. Friend, who has had to make a very difficult decision. He has made the right one, and done so on the basis of practicalities as well as scientific evidence. Was one of the practicalities that he envisaged that, in constituencies such as mine, with a densely populated centre surrounded by great swathes of countryside, it would be very difficult to undertake a cull and persuade people in the densely populated centre that that was the right thing to do?

Hilary Benn: That was one factor that I was bound to take into account in reaching my decision, because there are strong views on all sides and public opinion can have an impact on the practicality of a cull. It was entirely legitimate for that to be one of the factors that I weighed up in my mind, but above all the decision has been taken as a result of the science.

Ann Winterton: The dairy farmers in Cheshire to whom I spoke on Saturday were disappointed and angry at the lack of progress made on this important matter in more than a year. While prime dairy cattle are being put down and farming businesses put into limbo, the badger population is rising exponentially. Why are the epidemiological studies referred to by my right hon. Friend the Member for Fylde (Mr. Jack), the Chairman of the Select Committee on Environment, Food and Rural Affairs, only now being set up? Why have they not been done before? If a vaccine is eventually produced, what guarantees are there that the European Union will allow us to use it?

Hilary Benn: On the last point, we would have to argue our case, and I am sure that the hon. Lady would join me and others in doing so vigorously. Why would we not want to pursue a vaccine if it could be shown to work?

Ann Winterton: What would they do?

Hilary Benn: The EU could change the current rules that forbid it.

Ann Winterton: Are there guarantees?

Hilary Benn: There are no guarantees in dealing with this disease, but that should not stop us trying to pursue the right policy. We will be in a much stronger position to argue the case for changing that European rule when we have a vaccine. I look forward to going with the hon. Lady to argue our case when we have the opportunity.

David Taylor: Having served on the Environment, Food and Rural Affairs Committee since its inception, I am in a reasonable position to say that our report had more effort and energy put into it, under the leadership of the right hon. Member for Fylde (Mr. Jack), than any of our other reports.
	A chilling statistic that we found in the epidemiological evidence was that the rate of infection was doubling every four and a half years, with every potential to speed up. We said that culling could never be the cornerstone of TB control, but what priority has the Secretary of State told the partnership group to give to our suggestion, which should be pursued, that post-movement testing of cattle moving from high-risk to low-risk areas should be accelerated if it is possible and effective?

Hilary Benn: I am happy to say to my hon. Friend that I personally undertake to put that, and all the other suggestions that have been made about further steps that we can take, on the partnership group's agenda, so that we can discuss them. It is right to do so with the industry instead of my deciding now to impose them. All the controls have a cost for the industry, which is already bearing a considerable cost. It is right and proper that we should sit down with the industry, consider them all and decide between us what is the best thing to do. Most hon. Members recognise that that is right.

Daniel Kawczynski: As chairman of the all-party group on dairy farmers, I am absolutely devastated by the Secretary of State's decision. No doubt it will have to go to judicial review and be decided in the High Court. There will be extraordinary anger among dairy farmers in Shropshire, many of whom are on their knees as a result of bovine TB. There is an extra six-week waiting list there for infected animals to be collected.
	Will the Secretary of State initiate an inquiry into the leak of this announcement? Why did we yet again have to hear about such a matter on the BBC over the weekend? Why have we learned very little in the House over and above what we found out from the BBC? That is an absolute disgrace, and I want to know who leaked the information.

Hilary Benn: I would like to know that, too, but I take seriously my responsibility to come and report first to the House on the decisions that I have reached. That is exactly what I have done today.

Nigel Evans: We will be having an inquiry into that, then, won't we?
	The Secretary of State's decision has been described as "courageous". When Sir Humphrey used such terminology in "Yes Minister", it was normally to dissuade his Minister from making that decision. Is the right hon. Gentleman certain that he has made the right decision? If 18,543 cattle were culled last year and he says that he will keep the decision under consideration, how many cattle will need to be culled before he revisits it?

Hilary Benn: A number of adjectives could be used to describe the decision that I have reached. I have thought long and hard about it and I am convinced that it is right. That is why I am standing before the House to report it.
	As I said earlier, the number of cattle that may be culled depends on the progress of the disease. However, that would not change my view about whether badger culling can "meaningfully contribute", in the words of John Bourne. I have great respect for the hon. Gentleman and I ask him to have another look at the ISG report. It is a thorough, 10-year study and, although it did not produce the result that people expected, when the science shows that a course of action that people believe to be right turns out not to be, we should all give that careful attention, and that is what I have done.

Mr. Speaker: I understand that the hon. Member for South-East Cambridgeshire (Mr. Paice) wants to make a point.

James Paice: On a point of order, Mr. Speaker, before I responded to the statement, I omitted to remind hon. Members of my declaration in the register, for which I apologise.

Biofuels

Ruth Kelly: With permission, Mr. Speaker, I would like to make a statement on biofuels.
	There is widespread agreement in the House and the country that we must step up efforts to tackle climate change through dramatic and global cuts in greenhouse gas emissions.
	One of the most difficult challenges that we face is the use of fossil fuels for transport. Our cars and other forms of transport are the third largest source of carbon dioxide emissions in the UK. That is why the use of a clean, renewable energy, which can partly replace carbon-based fuels, was seen by experts, environmental campaigners and Governments around the world as a welcome and practical way of slowing emissions growth.
	In March 2007, after four years of encouraging biofuel use, the EU went further and set an ambitious target of 10 per cent. of transport fuel from renewable sources by 2020. In the UK, the Government introduced the renewable transport fuel obligation, which came into force earlier this year. That requires biofuels to make up 2.5 per cent. by volume of road transport fuel sales in the UK, increasing by 1.25 per cent. a year to 5 per cent. by 2010-11.
	The UK has also been at the forefront of global efforts to develop robust, and workable, sustainability standards for biofuels. As part of the RTFO, we introduced a requirement that transport fuel suppliers should report on the environmental performance of their biofuels. That will give us evidence on the impact of biofuels, as well as creating an incentive for suppliers to source the best biofuels.
	We also made a commitment to introducing at the earliest opportunity legally enforceable standards, which will ensure that biofuels are produced sustainably. However, in recent months questions have been asked about the more intangible, indirect effects of biofuels on food supplies and prices and on deforestation, and their overall impact on greenhouse gas emissions.
	I am sure the House will agree that our policy on biofuels should be based on the best possible science. So in February, I asked Professor Ed Gallagher, the chair of the Renewable Fuels Agency, to examine the latest available evidence. I welcome the publication of his report today and want to thank Professor Gallagher and his team for their thorough work on a highly complex matter.
	Let me outline Professor Gallagher's main findings. Overall, the report confirms that biofuels can play a role in tackling climate change and that
	"there is a future for a sustainable biofuels industry".
	It finds that by 2020
	"biofuels have the potential to deliver annual global greenhouse gas savings of approximately 338 to 371 million tonnes of carbon dioxide".
	But Professor Gallagher also concludes that there is a risk that the uncontrolled expansion and use of biofuels could lead to unsustainable changes in land use, such as the destruction of rainforest to make way for the production of crops. That might, in turn, increase greenhouse gas emissions, as well as contributing to higher food prices and shortages. The Gallagher report therefore concludes that the introduction of biofuels should be slowed until policies are in place to direct biofuel production on to marginal or idle land and until these are demonstrated to be effective. The detail of these control mechanisms would need to be agreed internationally.
	However, the report rejects calls for a moratorium on biofuels. It concludes that
	"a moratorium will reduce the ability of the biofuels industry to invest in new technologies"
	and
	"will make it significantly more difficult for the potential of biofuels to be realised".
	In short, the report concludes that
	"the Government should amend but not abandon its biofuel policy".
	The report recommends that the rate of increase in the RTFO in the UK should be slowed to 0.5 per cent. per annum, so that the RTFO reaches 5 per cent. in 2013-14, rather than in 2010-11 as currently planned.
	At the EU level, the report concludes that a mandatory 10 per cent. renewable transport fuel target is not currently justified by the scientific evidence, but that a target of 10 per cent. by 2020 could be possible if a number of important conditions are met. Those conditions include sufficient controls on land use change being enforced globally, as part of a new climate agreement, and new evidence providing further confidence that the target can be met sustainably. In the meantime, Professor Gallagher says that a more appropriate range for the 2020 biofuel target would be around 5 to 8 per cent. by energy.
	I agree with those key findings. Given the uncertainty and the potential concerns that Professor Gallagher sets out, it is right to adopt a more cautious approach until the evidence is clearer about the wider environmental and social effects of biofuels. We also need to allow time for more sustainable biofuel technologies to emerge. I therefore intend to consult formally on slowing down the rate of increase in the RTFO, taking the level to 5 per cent., as Gallagher recommends, by 2013-14, which would be subject to further confirmation in 2011-12.
	Professor Gallagher's findings are particularly significant in the context of ongoing debates about biofuel targets across the EU. To help to ensure that sustainability is put at the heart of those debates, the Environment Secretary and I are today jointly sending a copy of the Gallagher report to the relevant European Commissioners and to all EU Environment and Transport Ministers. In response to those concerns, including over rising global food prices, the Prime Minister has today been pushing for the G8 to work to develop new global benchmarks for sustainable biofuel production and use.
	The Government believe that the EU target of 10 per cent. renewable transport fuels by 2020 can remain an overall objective, but subject to clear conditions. I would like to set those out. First, the EU-level sustainability criteria currently being negotiated must address indirect, as well as direct, effects on land use. Secondly, the 10 per cent. target must be subject to rigorous review in the light of the emerging evidence, so that we can make an informed decision at EU level in 2013-14 about whether the target can continue. As Professor Gallagher also suggests, I agree that we should aim to target support on the development of lower carbon and other so-called "second generation" biofuels.
	Looking ahead, we will continue to work with our international partners and the scientific community to decide what further work needs to be done to reduce the uncertainties in the science and ensure that the right biofuels are supported. We will also continue to investigate other technological solutions that have the potential to deliver a low-carbon transport system, such as hybrid and electric vehicles.
	I believe that the approach that I have set out today is the responsible one. It acknowledges that biofuels can have an important role in reducing carbon emissions and combating climate change, but also recognises that we need to proceed cautiously until we can be certain that their expanded growth and use maximises the benefits and minimises the risks to our world. As I have demonstrated today, I will not hesitate to alter our policy if that is what the science suggests is appropriate. I commend this statement to the House.

Theresa Villiers: I thank the Secretary of State for advance notice of her statement. The Opposition have been telling the Government for months to think again on their biofuels policy. The Conservatives were the only political party to vote against the renewable transport fuel obligation. Although we believe that biofuels can have a role to play in tackling climate change, there must be safeguards to ensure that they come from sustainable sources and we must address the impact of biofuel production on land use and fuel prices. Frankly, the RTFO does neither of those things, and the statement provides only limited reassurance. The RTFO has come under sustained attack from groups such as Friends of the Earth, Oxfam, the Royal Society for the Protection of Birds, the Royal Society and the Environmental Audit Committee, and today the Government's own Gallagher report confirms that biofuel targets set by the Government could lead to unsustainable changes in land use, higher food prices and a net increase in greenhouse gas emissions.
	I welcome the fact that the Secretary of State has acknowledged today that there is a serious problem with her biofuels policy, but what have we actually got from her statement? We have got another consultation, and a review of the 5 per cent. target in 2011-12. I certainly welcome the slowdown that the Government have suggested they might undertake in relation to the 5 per cent. target, but a partial retreat is not enough. I repeat today the question that I asked the Secretary of State in January: will she now suspend the RTFO, in the light of the serious problems revealed by the pressure groups and confirmed in many respects by the Gallagher report?
	The fact is that a mere slowing down of the targets will not address the problems that are occurring today. The rain forest is under threat right now, and the habitat of orang-utans is being wiped out right now by palm oil plantations. When will the Secretary of State introduce the vital binding rules on sustainability? Why were they not in her statement to the House this afternoon? Why did she not commission and publish this report before designing the RTFO and bringing it into operation? Why did she steam ahead without carrying out a thorough investigation of the facts?
	Will the Secretary of State tell us how many litres of biofuel covered by the RTFO have been imported since its inception in April, and from which countries? What can she tell us about the source of those imports? Were any of them instrumental in deforestation? How many of them are made up of palm oil, a substance that Friends of the Earth says has been responsible for 87 per cent. of the recent destruction of the rain forest in Malaysia and Indonesia? Why did she introduce the RTFO before conducting a thorough assessment of the impact of the displacement of crops to areas where they could cause deforestation?
	When is the Secretary of State going to start publishing this kind of information and an analysis of how the RTFO is operating in practice today? How many litres of biofuels from unsustainable sources does she expect to have been imported into this country before we get real, lasting and serious reform of the RTFO? How can she possibly justify the Prime Minister's posturing about this issue on the international stage while at home she presses ahead with policies that encourage the use of biofuels that could actively damage the environment?
	The Gallagher report is an admission of failure by the Government. Their RTFO biofuels policy is a failure. It has failed industry and farming, because the uncertainty caused by Government dithering is jeopardising investments, not only in existing programmes but in second generation biofuels and in renewable and green technology generally. It has failed the poor of the developing world because it was introduced without safeguards to tackle the problems that are caused when biofuel crops compete with food production. It has failed the environment because it contains no effective measures to guarantee that the biofuels it promotes come from sustainable sources. The Government have made no move to address those failures today.
	It is deeply irresponsible to press ahead with a policy that risks driving up food prices and actively encourages people to rip up the rain forests, with the consequent loss of hugely important carbon sinks and wildlife habitats. Why will the Secretary of State not address the facts that are staring her in the face, admit that she has got her policy on biofuels seriously wrong, and suspend the operation of the RTFO?

Ruth Kelly: The hon. Lady has posed a series of questions, and I will answer as many as possible in the parliamentary time available. Let us avoid political point scoring for a moment and take a step back to look at the report in front of us. Surely she and her colleagues will acknowledge that—as Gallagher found in his comprehensive review of the evidence—there is a future for a sustainable biofuels industry. Indeed, just three years ago there was consensus on the issue among the Government, industry, environmentalists and, of course, her own party. It was only at the end of 2005, at a speech to the Renewable Energy Association, that her party leader, the right hon. Member for Witney (Mr. Cameron), said:
	"Five per cent. of all fuels sold in the UK to come from biofuels is a start, but it is a minimum step: we will need to go further in the future."
	The hon. Lady must also acknowledge that the UK has been at the forefront of efforts to promote sustainability in respect of biofuels. She asked why we did not set up the review to examine indirect land use change before we introduced the RTFO. When she has time to read the Gallagher review, she will see that it says very clearly that the RTFO was established before evidence of the scale of possible indirect effects was known. Indeed, a particularly influential paper from a US economist in February changed the terms of the debate, and the evidence has changed very rapidly over the past few months. It was precisely because the scientific evidence had been changing that I asked Professor Gallagher to review the evidence—the latest evidence—and to make recommendations about the way forward.
	We now face a clear choice: either we do as the hon. Lady suggests—abandon our biofuels policy and put the RTFO on hold or, indeed, abolish it—or we amend our policy and proceed more cautiously while collecting the evidence, narrowing the range of uncertainties and putting in place the appropriate safeguards. Professor Gallagher is very clear about the responsible way forward, and he thinks we should continue with our policies because there are such things as good biofuels. We need to encourage them and to put in place the sustainability that the hon. Lady and I both want, but we cannot risk all the investment in the sector, not only throughout the world but in our country, which might make it possible. Biofuels have the potential to produce very serious greenhouse gas emissions reductions if indirect land use change is avoided. That is the Gallagher review's overall finding, and it is one I accept.

Louise Ellman: My right hon. Friend refers to investigating other technological solutions. Will she outline the additional resources that will be employed in doing so, and exactly what she means by that statement?

Ruth Kelly: My hon. Friend will know that I have committed the Government to work with their international partners, particularly in the European Union but further afield as well, to ensure not only that we understand the indirect land use change effects more fully and put in place global mechanisms to try to prevent such land use change, but that we encourage the industry to innovate and to produce second generation biofuels that will not by definition avoid land use change but may help in producing greater greenhouse gas emissions reductions. One recommendation of the Gallagher review is a specific target, negotiated at EU level, to try to encourage the production of advanced or second generation biofuels. We all need to think about that very carefully.

Norman Baker: I welcome the early sight of the statement from the Secretary of State for Transport, although I saw most of it in the  Financial Times this morning. If one knows where to look, one can generally find Department for Transport statements in the press before they are delivered to the House. Will she take steps to ensure that the House is informed before the press about statements on such important matters?
	I broadly welcome the statement, although it might have been made a little earlier. The Environmental Audit Committee reported on the matter quite thoroughly, but the Secretary of State went to Professor Gallagher, who has come out with roughly the same statement as the Committee. Nevertheless, the broad conclusion that we should not abandon but amend the policy on biofuels is correct. Clearly, some biofuels are being produced unsustainably, but we should not throw out the biofuel baby with the bathwater, as some apparently would wish.
	I have some questions. First, will the right hon. Lady provide a figure for the impact of biofuel production on food prices? The estimates seem to vary widely, and I have seen figures of between 3 and 75 per cent. in various reports. Secondly, what steps is she taking to improve the sustainability criteria and certification of existing biofuels so that there are no problems with them, given the poor EU regulations on the matter?
	Thirdly, what discussions is the Secretary of State having with businesses involved in the development of second generation biofuels, which we all agree we should promote? There is an opportunity to progress that, and I hope that she can take it forward. Fourthly, what is she doing about what I think are the improper subsidies for biofuels from the US? I am thinking particularly of corn-based ethanol and the disgraceful splash-and-dash arrangements, which mean that adding 1 per cent. of US diesel qualifies the fuel for subsidies when it comes into this country. That is bad for climate change as well as for the economy.
	Lastly, I welcome the Secretary of State's recognition that the transport sector has a major role to play in tackling climate change. Is she seeking to replace the carbon reduction losses that there will now be as a consequence of the reduction in the biofuels target? Will she apply the logic behind trying to ensure that the transport sector deals with carbon emissions to her aviation policy as well?

Ruth Kelly: First, I should say to the hon. Gentleman and the House that I take my obligations to the House extremely seriously. The press speculation about the content of this statement was not always well informed and certainly did not reflect the detailed content of the report. However, I welcome the tone of the hon. Gentleman's comments.
	We do face a choice whether we should abandon the greenhouse gas savings that may come from biofuels—if not now, then potentially in the future—or whether we should scrap our commitment to biofuels and argue that Europe and the wider world should do so too. As I said, Professor Gallagher is clear about his view: we should proceed, albeit more cautiously than we had assumed we should in the past.
	The hon. Gentleman asked about food prices; the report has a chapter about the impact of biofuels on those. Professor Gallagher is clear that biofuels are not the only reason food prices have increased in recent years. Other, more important factors include smaller harvests last year because of droughts, higher fertiliser prices, rising gross domestic products and changing diets in the far east. The Gallagher review concludes that increasing demand for biofuels contributes to rising prices for some commodities, notably oil seeds. However, it says that the price rises are rarely more than 5 per cent. for most crops. That is one of the reasons it is suggesting a more cautious approach. In some areas, there is a marked impact, particularly in the short term, on particular populations in respect of some crops and some biofuels. That is why Professor Gallagher says that we ought to identify those specific effects and take global action to try to mitigate their impact.
	The hon. Gentleman asked about sustainability criteria. We are currently negotiating such criteria in the EU context. The renewable energy directive, which should conclude later this year, will propose sustainability criteria. We want to insist that it should now also include the indirect effects of biofuels use. He also asked about second generation biofuels. One of the more surprising conclusions of the Gallagher review was that such biofuels do not always have a clear advantage over first generation biofuels, particularly when land use change is taken into account.
	First generation biofuels often produce co-products that can be used as a protein substitute for animal feed—as will happen at the Ensus plant in the north-east, for example. When such use is made of co-products, the impact on land use change can be minimised. Overall, the picture is much more complex than it sometimes appears at first sight; nevertheless, there is potential in exploring further the contribution of second generation biofuels.
	We will use the report to try to influence the debate at EU level and in the US. The hon. Gentleman asked about the contribution of the transport sector in tackling climate change. The Gallagher report says that a 10 per cent. transport renewables target could still be appropriate, provided that certain evidence emerges and that appropriate safeguards are in place. It is important, of course, that we should keep that under rigorous review and take any necessary action if evidence emerges that the target is too ambitious.

Jeremy Corbyn: Is the Secretary of State aware of the enormous problems created by the production of maize-based ethanol, as pointed out by the hon. Member for Lewes (Norman Baker)? In central America, the price of tortillas has gone up by 35 per cent. in the past year, causing real hardship to the very poorest people. Have we not an obligation to do all we can to reduce the production of maize-based ethanol, which is neither particularly effective nor particularly efficient and damages the livelihoods of many of the poorest people all around the world? The whole strategy ought to be about reducing the consumption of fuel by private road transport. It seems obscene that we should allow people in central America and other parts of the world to go hungry to feed the gas guzzlers of the United States and parts of western Europe.

Ruth Kelly: My hon. Friend gives a very specific example of bad biofuels. He is absolutely right to suggest that we have a moral obligation to try to weed out, as it were, the impact of bad biofuels on food prices, as well as the potential risk of increasing overall CO2 emissions. The Gallagher report is clear, however, that there are sustainable biofuels and that we should direct their growth on to idle and marginal land. That is one way of minimising their impact.
	My hon. Friend also asks about reducing the consumption of fuel, and my answer is that he is absolutely right to say that biofuels are part of a much wider and bigger picture. How do we feed the world's poor in years to come? The answer does not lie in biofuels or necessarily in the contribution of the transport sector, although it has a role to play. We have sizeable moral obligations as Governments across the world to try to think through the wider implications of how we feed the world.

Philip Hollobone: What extra incentives are the Government going to introduce to encourage innovation in the hybrid and electric vehicles that the Secretary of State mentioned?

Ruth Kelly: It is true that hybrid and electric cars may well have an important role to play in the future. Indeed, Professor Julia King, who looked into the fuel efficiency of cars and potential technological solutions in future as a means of minimising the impact on the environment, suggested that those vehicles could have an important role after 2020. I have already had conversations with people who are interested in bringing more electric vehicles into the country. It is not necessarily a matter of financial incentives, as it is more about facilitating, particularly through the planning system, the infrastructure necessary to promote the use of those vehicles. Clearly, when people drive such a car, they need somewhere where they can plug it in to charge up. We are having discussions about this issue across government, but it is absolutely right to say that electric cars could have an important role to play in the future.

David Drew: I hear what my right hon. Friend says. Speaking as someone who saw the advantages of the RTFO, I have not quite changed my mind, although I can also see some of the dangers. The reality of the statement is that we should be entering into international discussions with countries such as Brazil, where the biofuels industry is a major factor in development, and try to persuade them to look at using waste products such as molasses rather than corn or wheat, which my hon. Friend the Member for Islington, North (Jeremy Corbyn) mentioned, as a way of producing biofuels—with all the consequent dangers to the Amazon. We should be doing that as a matter of priority, so I hope my right hon. Friend will take it into account.

Ruth Kelly: I thank my hon. Friend for his comments. One of Gallagher's interesting conclusions is that the best and worst forms of greenhouse gas savings on biofuels are currently achieved from sugar cane. Even within Brazil, there are very good examples of biofuel production that are energy efficient and high yield. Some Brazilian mills even export electricity to the grid. What we need is a debate in global forums as well as within the EU about how to encourage the use of sustainable biofuels. One challenge that we have set the Renewable Fuels Agency, which will operate at arm's length from the Government, is to use the report and work with our international partners to establish more evidence and to try to encourage people to think differently about the way biofuels are currently grown.

John Redwood: How will the Secretary of State ensure that all future crops for fuel in this country are grown on currently idle land?

Ruth Kelly: The right hon. Gentleman makes an incredibly important point. In the north-east of England with the Ensus site, but also on other sites, the production process has very substantial direct greenhouse gas savings from well to wheel. Part of the reason for that is, as I have explained, that the co-products are also used to substitute for animal feed. What it does not take into account is the indirect impact. The report suggests that even in those cases we ought to think through the indirect impact. Clearly, we do not currently have a mechanism for measuring the indirect impact, or for safeguarding against the potential greenhouse gas consequences or the increase in food prices that might result. In future, however, we should aspire to that. The report sets out a cautious approach that will give us time to have those global negotiations to put in place progressive measures to control land use, and to make sure that as far as possible—it will not always be possible—first or indeed second generation biofuels are produced on idle or marginal land.

Mark Hunter: Does the Secretary of State share my concerns about the conclusions of the Environmental Audit Committee, which came out in favour of a moratorium? Does she not agree that the way forward is through greater and better certification and regulation? The consequence of throwing the baby out with the bathwater is that without investment in first generation biofuels, damage will be done to the potential for future investment in second and third generation biofuels, which are likely to have a much more beneficial impact.

Ruth Kelly: I agree with the hon. Gentleman, who makes an important point. The reason that investors are prepared to invest in clean technology and think about second generation biofuels is that there is a market for biofuels. Part of our approach must be to take that into account and to think about how the risks can be minimised, while examining the evidence and collecting the data necessary to make good judgments in future, and ensuring that sufficient investment takes place in those innovative technologies.

Nigel Evans: The rush to biofuels seems to have led to at least three unexpected consequences: first, higher food prices; secondly, deforestation; and, thirdly, a sliver of sanity belatedly creeping into the Government. The Secretary of State knows that the 10 per cent. by 2020 target is dear to the heart of José Manuel Barroso, the European Commission President. Although she is clearly doing the right thing in sending out signed copies of the report to any interested parties in the EU, she must also remember that the largest biofuels producer is France, which has just taken over the presidency of the EU. What else will she do to ensure that a sliver of sanity also breaks out in Brussels, and that it reconsiders its targets on biofuels?

Ruth Kelly: I thank the hon. Gentleman for his comments. I will seek to persuade my European partners and the European Commission to take such evidence seriously, and to encourage them and their scientific experts to work with those in the RFA in examining it. However, to say that biofuels inevitably increase food prices is a bit simplistic. One of the messages of the report is that some biofuels have a significant impact, especially in the short term and on certain types of rural poor. In the longer term, the effects are much mitigated, and the world should perhaps be thinking about policies to mitigate those impacts in the short term too. It is important to have a balanced approach, and to encourage France and Italy, which are already showing signs of working with us in this area, to continue the pursuit of a sustainable biofuels industry.

David Heathcoat-Amory: Following that reply to my hon. Friend the Member for Ribble Valley (Mr. Evans), does the Secretary of State recall that when the House debated such matters last month, the Department for Business, Enterprise and Regulatory Reform willingly signed up to and endorsed the 10 per cent. target for biofuels in transport fuels by 2020. A month later, the Secretary of State is resiling from that, saying that it is unsustainable and unobtainable. Given that the decision on the draft EU directive will be taken by majority voting, what confidence does she have that her new conditionality and different target will be accepted, as the directive is, after all, mandatory?

Ruth Kelly: I said that we should be arguing for a non-binding target, but a target of 10 per cent. conditional on certain elements: first, second generation biofuels should emerge; and secondly, unsustainable land use change should be avoided and sustainability safeguards adopted. I said that we should review the evidence in 2011-12, and again later, to confirm those targets.
	That is an approach for which we shall negotiate very hard in Europe. I believe that it is beginning to gain currency in France and Italy, and I hope that other countries will also see the merits of adopting a conditional rather than a binding target.

Bob Spink: Will the Secretary of State explain why she has confidence in the sustainability criteria that she is currently negotiating with the European Union? I should like to know why she feels that she could possibly have confidence in those. Will she also tell us what direct control she will exercise to ensure that biofuels used in the United Kingdom come from sustainable sources?

Ruth Kelly: The hon. Gentleman asks what confidence I have in the sustainability criteria that are currently being negotiated. The report concluded that they ought to be made more sophisticated. Although we have tried to capture the direct impacts on greenhouse gas emissions from well to wheel, we have not yet attempted to calculate the impact of the indirect effects of biofuel production, which is an incredibly difficult calculation. Before January this year, hardly anyone with an interest in the subject even considered the possibility of significant indirect effects on either greenhouse gas emissions or food prices. One of the challenges that we face is to work with our European partners intensively over the next few months to develop a set of sustainability criteria that include a measure of indirect impact.

Henry Bellingham: The Secretary of State admitted a moment ago that growing food shortages and soaring food prices had rendered the redirecting of cereal and root crops to biofuel production highly questionable. She is presumably aware that much of our current biodiesel production results from the refining of used cooking oil. Can she tell us what percentage of it comes from that source, and has she any idea of the potential annual tonnage?

Ruth Kelly: I am afraid I cannot give the hon. Gentleman the figures that he seeks today, although I shall be happy to provide them if they are available. However, I have talked to suppliers about their innovations in that regard. The hon. Gentleman is right to suggest that the current developments are having an impact—particularly in Scotland, I understand. This is what is typically known as second generation biofuel. Again, the impact on both greenhouse gases and food prices will depend on the indirect effects, which are not currently captured in our sustainability reporting mechanisms, although that is what we aspire to for the future.

Peter Bone: I listened to the statement with growing concern. Last year, I purchased a biofuel car believing that I was saving the planet. Could the Secretary of State give me some clear advice? As she will know, a biofuel car can run on biofuel or petrol. When I next pull into Morrisons in Welingborough, should I go to the petrol pump or the biofuel pump?

Ruth Kelly: My advice is that the hon. Gentleman should adapt to the evidence, as the Government have. However, let me make a serious point.
	The Gallagher review has made it clear that investment in biofuel production should be encouraged, and in particular that it should rise above the current level of 2.5 per cent., so that investors are confident enough to proceed with the investments in bioethanol that are planned in the United Kingdom.

Points of Order

Helen Jones: On a point of order, Madam Deputy Speaker. The hon. Member for Forest of Dean (Mr. Harper), to whom I have given notice of my point of order, visited my constituency on Friday with no notice. I understand that although he was quite far north in Warrington, he believed that he was in Warrington, South. Although I am cheered by the fact that Opposition Front Benchers cannot even find the constituencies they are supposed to be targeting, will you take this opportunity to remind them that they too should observe the courtesies of the House, and perhaps even buy a map?

Madam Deputy Speaker: Although that is not a point of order for the Chair, the hon. Lady would be right to approach the other hon. Member about this matter. It is a courtesy of the House for Members to inform other Members when they are visiting their constituencies.

Tim Boswell: On a point of order, Madam Deputy Speaker. Given the success yesterday of the British grand prix held at Silverstone in my constituency, have you received any representations from Ministers to make a statement on the implications of contracts for that event after 2010? If it is to move from Silverstone, it is essential that an alternative venue be up and ready at that time. If not, there is a real risk that we may lose the British grand prix altogether.

Madam Deputy Speaker: That is not a point of order for the Chair, but the hon. Gentleman's comments are on the record and members of the Transport team are present to have heard them.

David Taylor: On a point of order, Madam Deputy Speaker. That race may be coming to the Castle Donington circuit in North-West Leicestershire, but my point relates to the fact that ETS Europe was given £156 million by the UK taxpayer to handle the key stage 2 and key stage 3 marking process. It has just announced that it will not be able to post the key stage 2 results for a further eight days and the key stage 3 results for a further 11 days. That is utter and depressing incompetence. Has there been any indication from the Secretary of State for Children, Schools and Families that he wishes to make a statement on this, particularly for those parts of the country, such as Leicestershire, where the schools break up this Friday? The results will be given in the summer holidays, causing substantial inconvenience.

Madam Deputy Speaker: Once again I have to say that although that was not a point or order for the Chair, I understand the hon. Gentleman's concern and his remarks are now on the record. I have not been advised that the Secretary of State wishes to come to the House to make any such statement.

ESTIMATES DAY
	 — 
	[3rd Allotted Day]
	 — 
	ESTIMATES, 2008-09
	 — 
	DEPARTMENT FOR TRANSPORT

Public Transport

[Relevant documents: The Fifth Report from the Transport Committee, HC 84, on Ticketing and Concessionary Travel on Public Transport, and the Government response, HC 708.]
	 Motion made, and Question proposed,
	That, for the year ending with 31st March 2009, for expenditure by the Department for Transport—
	(1) further resources, not exceeding £8,777,927,000, be authorised for use as set out in HC 479,
	(2) a further sum, not exceeding £7,136,325,000, be granted to Her Majesty out of
	the Consolidated Fund to meet the costs as so set out, and
	(3) limits as so set out be set on appropriations in aid.—[ Alison Seabeck .]

Louise Ellman: I very much welcome the decision to have in this important estimates debate a discussion on the Transport Committee's report on ticketing and concessionary travel on public transport. That report focuses on the new national concessionary local travel scheme for older and disabled people. It also discusses a number of other important issues, including integrated ticketing, smartcard technology and revenue protection, which includes looking at how to minimise fare dodging. All those issues are extremely important for passengers and public alike and it is extremely important that we have the opportunity today to discuss both the report and the issues raised in it.
	A great deal of attention was attracted by the inquiry. More than 40 organisations and individuals submitted written evidence and the Committee held four oral evidence sessions, questioning 24 witnesses including the Under-Secretary of State for Transport, my hon. Friend the Member for Glasgow, South (Mr. Harris). The Government published their response on 16 June.
	The English concessionary free bus travel scheme, benefiting up to 11 million older and disabled people at a total cost of £1 billion, is extremely welcome. We have been discussing the scheme for England. Of course that is because the schemes for Scotland and Wales have already been operating following decisions from the devolved Administrations. It is an important scheme about which there was a great deal of campaigning over a long period.
	It is important that the scheme be properly funded and that the extra £223 million allocated to local authorities by special grant this year—with more to follow next year and the year afterwards, in addition to the £31 million provided for the new passes— reimburses operators and authorities fairly. There is currently a great deal of dispute, not only about the amount of funding made available but about the way in which it is allocated. Perhaps through the review of the bus service operators grant, this matter can be addressed. It is extremely important that a scheme that is popular and welcome should be funded properly and fairly. Although the concessionary passes are Integrated Transport Smartcard Organisation—ITSO—compliant smartcards, only 5 to 10 per cent. of the bus fleet will be equipped to process them by the end of 2008. Part of the reason for that appears to be the cost to the bus operators of installing the equipment to use those cards to their full. That is not a satisfactory situation. The Government must speed up this process, both to secure the best and optimum use of the card and to obtain more accurate information about who is travelling using the card. That is extremely important in relation to the revenue issues to which I have referred.

Nicholas Winterton: Will the hon. Lady address the inequality of the service in respect of those areas of the country where there are no public bus or coach services? I fully support and welcome a Government—or taxpayer—contribution to public transport, but what are we going to do for the people who live in those rural areas where there is no, or very little, bus transport?

Louise Ellman: The hon. Gentleman makes an important point, and anticipates my next comment. The report considered this issue. Concessionary fare schemes are very much to be welcomed, but the transport has to be there for people to be able to enjoy them. The Committee raised the question of community transport, and called for more support to enable more community transport to be provided and for that to be eligible for the concessions, or equivalent concessions, so that people, and particularly those living in rural areas, would be able to benefit from widened opportunities in terms of transport. That is what the scheme is all about.

Daniel Kawczynski: I wish to reiterate what my hon. Friend the Member for Macclesfield (Sir Nicholas Winterton) said about rural counties. In Shropshire this month, many bus services are being stopped. Although it is great that the Government want to have concessionary travel, my constituents are extremely concerned that if there are no services in some places, there will be two classes of citizen. Those who live in London and other cities can take advantage of such schemes, but those who live in rural areas such as Shropshire cannot.

Louise Ellman: The absence of bus services in some areas is a very important issue, and it is one of the consequences of deregulation. That issue is being addressed through the new Local Transport Bill, which is before Parliament. It is important that that Bill is sufficiently strengthened to enable the services that are required to meet local needs to be developed.

Eric Martlew: Does my hon. Friend agree that although the inequalities that have been talked about do exist, this system is of benefit even to people who live in rural areas, because when they visit towns or go on holiday or come to London, they can now travel on the buses if they have a pass, whereas before they had no service whatever?

Louise Ellman: My hon. Friend makes an extremely important point. A point that was consistently raised during the long campaign for such a national scheme was that when people went away from where they lived to other areas, they were not able to take advantage of concessionary local transport. Because of the existence of this concessionary scheme, people can take advantage of such local transport schemes everywhere, even in places where they do not live.

Tim Loughton: The point the hon. Lady makes rightly suggests that, as the Government have acknowledged, the number of people visiting tourist resorts, including coastal towns such as mine of Worthing, is likely to put greater pressure on bus services in those areas, leading to the costs falling disproportionately on those areas. Does she think the formula the Government have drawn up to decide how to reimburse local authorities accurately reflects those extra pressures, particularly on tourist areas?

Louise Ellman: The important point the hon. Gentleman makes underlines the need for an evaluation of the way the scheme is working and a closer look at how the available revenues allocated to local authorities are to be disbursed. His point has been raised by a number of local authorities, and our Committee's report talks about the importance of evaluating the scheme and of a re-evaluation of how the money is allocated. The point he makes was one of the ideas that we had when we put that proposal forward.

Peter Bottomley: I share the concern of my hon. Friend the Member for East Worthing and Shoreham (Tim Loughton). Would it not have been better if the Government had said that, for the first couple of years, local authorities would be able to work out their costs, indent for them, and then have an evaluation and a formula? Instead, we will have winners and losers and will have to work out what to do about that. If local authorities could claim their actual costs, it would be much fairer to our rate payers, nearly half of whom are elderly and are having to bear the costs of the Government's error.

Louise Ellman: It was important that the scheme went ahead, and it is equally important that a proper evaluation is made and anomalies are put right.

David Drew: Does my hon. Friend also accept the obverse argument on the evaluation, expressed by some of the companies, that local authorities have not always made the payments for the number of passengers carried? Much as I would want to comment about the services that the companies offer, evaluation is needed by both sides, as I am sure she would agree.

Louise Ellman: My hon. Friend raises an important issue. Discussions are needed between the transport authorities and the operators, as well as the Government. Many of the issues involve the accuracy of information on who is travelling, when they are travelling and where they are travelling. That is why it is important that the appropriate technology is installed as quickly as possible on the buses involved.
	The Committee's report also looked at the broader question of integrated ticketing, or having a single ticket to cover several legs of a journey—if not the whole journey. Here we found a great difference between rail travel and bus travel. On rail, because of the Government's actions in ensuring that provision was made through the franchises, arrangements ensure through ticketing on the national network, and that is of great importance to passengers. However, wider concerns remain about the wider issue of ticketing, including the availability of tickets.
	Closure or minimal staffing of ticket offices may force passengers to use the internet or ticket machines when they do not want to. Indeed, some tickets are available only on specific websites and machines do not operate for all ticket types. It is important that all passengers have access to all tickets and can get the best deal when they travel by train.
	Since the report was completed, announcements have been made that fares, and the tickets that go with them, are to be simplified. It will be important to look at that in more detail. Simplification of the fare structure is to be welcomed, but concerns have been raised about whether the simplification will mask large price rises. That is a matter that we will need to look at in the future.
	The situation with integrated ticketing on buses is highly unsatisfactory. Concerns about breaching competition law have impeded action in addressing the problem that several different tickets may be required for one journey. The Government must ensure that the new Local Transport Bill provides the means, perhaps through quality contracts, to resolve that. It is important that any measures introduced should be strong enough.
	I am pleased to see in the Government's reply to the report that they will consider a recommendation that traffic commissioners have the power to arbitrate if local authorities and bus operators cannot agree on the pricing of multi-operation travel cards. More needs to be done on integrated ticketing on buses, and the Bill may help, but we must ensure that the problems are resolved. The Committee also noted that insufficient attention is given to travelling by coach. Many people travel by coach, yet there is little integrated ticketing and little attention is given to coach travel as a mode of transport.
	We were told in one of our Committee sessions by the director of fares and ticketing at Transport for London that tickets were introduced in 1853 to prevent bus conductors from pocketing fares. He told us that 70 per cent. of revenues used to disappear and that was why tickets were introduced. It now appears that tickets are giving way to the plastic smartcard and, indeed, to other technologies. We looked at the successful Oyster card scheme in London and at other local smartcard schemes. TFL anticipates that the Oyster pay-as-you-go system will be linked to the national rail network in London by 2010. Indeed, we received evidence from many people who told us that they wanted the Oyster scheme to be linked more widely to the national network.
	The Government should articulate a clearer strategy for integrated ticketing in general and smartcards in particular, but they must show the costs and the benefits of the high expenditure involved. Industry experts assess the costs of smartcards and rail franchises at £100 million per scheme and it costs £3,000 to equip a bus with equipment for the cards. Technology is important but the Government must show the benefits and how the cost is justified.

Tim Loughton: To go back to the subject of concessionary fares, and as the hon. Lady has been talking about trains, did her Committee consider the merits or otherwise of extending the concessionary fare scheme for pensioners to allow them to travel on trains, too? Obviously, train operators have expressed some concerns that they are losing out on some of their custom. Given her talk about integrated ticketing systems, does she think that the future for concessionary bus fares is that they will be extended to rail services, too?

Louise Ellman: We received some limited evidence on that issue. We felt that we were not in a position to make recommendations, but that it might well be considered in the future. We stated that it was very important for local additions to the national scheme to be considered locally.
	We also looked at revenue protection and preventing fare dodging. We felt that that should have a much higher priority, particularly as fare evasion is often linked to antisocial behaviour. In 2006-07, there were 299 recorded attacks on staff connected with revenue collection in London stations alone. The Association of Train Operating Companies reported that 8 per cent. of revenue—that is, £400 million—is lost through passengers not paying fares. How much of that is deliberate evasion is unclear. It is clear that the availability of staffed ticket offices is important both to prevent fare evasions and to minimise aggressive behaviour, which has been reported when there are no staff in the area.

Philip Hollobone: Should not the train operating companies and bus operators that allow off-duty police constables on their services for free be applauded? When fare evaders are caught, they can often cut up rough, and it is reassuring for passengers and revenue protection officers if off-duty police constables are encouraged to use public transport where appropriate.

Louise Ellman: I agree with the hon. Gentleman. Indeed, we recommended that there should be additional staff involved and we were sorry that the Government did not accept some of our recommendations on that. We also called for a more independent appeals process for passengers who were accused of deliberate evasion. Again, we regretted that the Government did not feel able to support our cause. We hope that they will reconsider.
	I praise the work that Passenger Focus, the national passengers' group, has done to draw attention to the issue of penalty fares and how passengers are treated; the subject needs more attention from Government, and Passenger Focus has done very good work on it.
	The Committee's report welcomed the beginning of the new concessionary fare scheme. We looked to the future and suggested that concessionary schemes for young people could be considered. We decided to broaden the terms of reference of the inquiry that we are conducting on school transport to enable us to consider in more detail matters such as concessionary schemes for young people. I hope that we will receive appropriate evidence on the subject, because it is extremely important. All the issues that the Committee considered in its inquiry—concessionary fares, ticketing, revenue protection and integration—are important for passengers. They all contribute to the important task of making public transport accessible and attractive.

Nicholas Winterton: The hon. Lady has not really touched on the issue of the complexity of buying the best value ticket. I am concerned about the elderly who need to use public transport, whether they travel by bus, coach or train. Is she concerned about the fact that elderly people, in particular, may not be getting value for money or a fair deal, because the system is so complicated that they do not understand how to go through it, and ticket sellers at bus stations or railway stations will not always give them the best-priced ticket?

Louise Ellman: The hon. Gentleman is right to emphasise that point. The Committee conducted an inquiry on the issue, in which it drew attention to the problems that older people and other passengers had in accessing the best value tickets simply. Earlier this afternoon, I referred to people being forced to use the internet or machines, and mentioned the problems relating to that. The announcement that there are to be simpler fares and ticketing is to be welcomed, but the charges need to be looked into more fully.
	The Government gave a full, considered reply to the Select Committee. Some of our recommendations have been accepted, some have been ruled out, and others are being considered. I say to my right hon. Friend the Minister of State that all the issues in the report are important. We welcome the Government's considered reply, but we look forward to action, and hope that it is taken very soon.

Robert Goodwill: I congratulate the hon. Member for Liverpool, Riverside (Mrs. Ellman) on the way in which she presented the report. The Transport Committee, of which I was a member for my first 18 months in Parliament, has a reputation for having formidable Chairmen, and I am sure that she will establish her credentials in that regard. First, I must declare a non-pecuniary interest: one of the largest employers in my constituency is the Plaxton coachworks, part of the Alexander Dennis group, which makes not only coaches but buses. Some 550 people in my constituency rely on the public taking buses and making coach journeys, so I certainly have a constituency interest in promoting the use of buses and coaches.
	I am pleased that we have an opportunity to discuss concessionary fares, particularly the new national concessionary bus scheme introduced in April this year. Both the Government and the Opposition face problems in selecting subjects for such debates. In our case, we are spoiled for choice, having to choose from a long list of issues on which we wish to expose the Government's shortcomings. Conversely, the list of topics that could be considered relatively safe ground for the Government, which includes the topic that we are discussing, is rapidly dwindling.

Tim Loughton: My hon. Friend describes concessionary bus fares as a relatively safe topic, but he might like to know that the Minister for Local Government had to make himself available between Christmas and new year to deal with a very irate group of councillors and chief executives from councils in Sussex, who were protesting at the fact that our constituents will have to subsidise the scheme to the tune of more than £600,000 this year. Perhaps it is not as safe a topic of debate as he suggests.

Robert Goodwill: I thank my hon. Friend for that intervention. My speech contains good news and bad news; I will not disappoint him by coming to the bad news soon.
	Some people have described the concessionary scheme for the disabled and over-60s as a vote-catching gimmick. I reject that categorically, as to judge from the polls it has not caught many votes. I suspect that last month some of the voters of Crewe and Nantwich may even have used their concessionary tickets to go to the polling stations to vote Conservative for the first time. Eleven million people are now able to take advantage of their new right to off-peak bus travel across the borders of their travel concession authorities, whereas previously they could only use that concession locally. Our concern is about how the scheme may have been implemented and funded, and that is echoed by many of the points raised in the Select Committee's report.
	I do not often say this, but in many ways the Government have been a victim of their own success.

Tom Harris: Hear, hear.

Robert Goodwill: The Minister should not get carried away.
	Since April, there has been a significant increase in the number and length of bus journeys made. Nationwide, the use of concessionary fares has increased by between 30 and 50 per cent., and by even more in some areas—for example, Gloucester and Cheltenham have experienced growth of 120 per cent. In Greater Manchester, passenger journeys have increased by more than 10 million since the introduction of free travel for the over-60s and disabled. That is in the context of falling bus ridership outside London.
	The bill is picked up by the local authority where the trip originates. That has led to an increase in costs for some authorities, particularly in hot-spot destinations such as coastal towns and urban centres, where the share of the extra £212 million for this year has fallen short of the demand. Other local authorities in places such as Surrey have made a profit where resources have been over-allocated. Examples include Basildon, where a £500,000 shortfall was projected this year. In Blackpool, a £200,000 shortfall was projected. That does not cover the scheme that the council has had to introduce for its trams—because no one would use the trams when they had a concessionary ticket to use the buses, the authority has had to introduce a parallel scheme for the trams at additional cost to it. In Carlisle, a £272,000 shortfall has been projected. All the Essex authorities, including Chelmsford, Maldon—

Eric Martlew: Will the hon. Gentleman give way?

Robert Goodwill: By all means; I thought that I might have provoked the hon. Gentleman.

Eric Martlew: I suspect that most of those are Conservative authorities. Can the hon. Gentleman tell the House what his party would do?

Daniel Kawczynski: This is meant to be about scrutinising the Government.

Robert Goodwill: As my hon. Friend says, this debate is about scrutinising the Government. We are arguing not with the overall budget for the scheme but about its allocation—some local authorities have been allocated more money than they have used. The Government have patently failed to identify where the expenditure would be needed, and places such as coastal resorts and cities where people go shopping have borne the brunt.

Eric Martlew: I interpret the hon. Gentleman's remarks as meaning that the Conservative party will take money away from some local authorities to give it to others. Is that correct?

Robert Goodwill: My point is that it is important that the money allocated for the scheme is allocated correctly.
	Carlisle told us that it had a £272,000 shortfall. If the hon. Member for Carlisle (Mr. Martlew) would like to dispute that figure, I would be pleased to hear his estimate, but the council tax payers of Carlisle are certainly picking up that bill.

Eric Martlew: The hon. Gentleman is drawing me into this; I did not want that to happen. The reality is that the Conservative party in Carlisle said that it would cut the hours of the scheme to after 9.30 am, then changed it and said that the disabled could travel all the time, and then, three days before the local elections, found extra money to say that everybody could travel all the time. The idea that it had a shortage of money is absolute nonsense.

Robert Goodwill: Perhaps I could run this one past the hon. Gentleman. If he thinks that I am mentioning only Conservative-controlled authorities, Barnsley metropolitan borough council, which is hardly a Conservative stronghold, told us:
	"I do feel our local authority is receiving inadequate compensation from Central Government for funding concessionary fares."
	This is not restricted to Tory authorities. Because of that uncertainty about take-up, which the Government failed to predict, local authorities are having great difficulty in planning ahead.
	On the alphabetical list, I started with the Bs, and I shall end with the Ws. Winchester has a shortfall of £300,000; Worthing has a £600,000 shortfall; and Wyre has a £100,000 shortfall.

Tim Loughton: I am grateful to my hon. Friend for the mention of Worthing. In fact, the figure for the Worthing and Adur authorities combined, which are in partnership, is about £624,000 for the current year. When I brought the deputy leader of Worthing council, Ann Barlow, and the leader of Adur council, Neil Parkin, to see the Minister, they said that they would rather the scheme were not funded through them. Why do local authorities need to control this scheme? They are losing money that will be made up by council tax payers, or by the cutting of local services. Why can the Government not fund what is supposedly a fully funded scheme and operate it themselves, rather than operate it through local authorities, which have to pick up the bill for what is, in our case, not a fully funded scheme?

Robert Goodwill: I am sure that the Minister has had a number of suggestions about how the scheme could have been better funded. With regard to local authorities, it would be hard to think of a worse way of funding it. As the Select Committee report says:
	"The anomalies within, and disputes over, the distribution of concessionary travel grant to local authorities look set to continue, despite the 'generous'"—
	I am not sure whether the Government put those inverted commas around the word generous, or the Select Committee—
	"funding provided by the Government and the new funding formula."
	That was written in March, before oil and diesel prices reached their current dizzy heights. If things were bad then, they are worse now.

Norman Baker: The hon. Gentleman is right to say that the scheme is not functioning properly and that the financial arrangements are haphazard at best, but does he accept that local authorities—we have done some work on the matter, as has his party—estimate that, overall, they are £60 million short of the money that they need just to break even, were the distribution correct? That is the case not least because of the massive increase in bus patronage that the scheme has generated. Would it not be more honest to say that the figure of £60 million—or whatever he thinks it is—should be met by extra money from the Treasury? If he does not pledge extra money, as my party has, the consequence will be that all local councils will be short of money.

Robert Goodwill: The hon. Gentleman makes a valid point, but making pledges on behalf of the Treasury is slightly above my pay grade.

Daniel Kawczynski: I am grateful to my hon. Friend for giving way—it will give him a chance to look at his notes. He mentioned a long list of areas that had lost out as a result of a lack of Government funding, but he did not mention Shropshire. Shropshire county council—rather the borough council—has lost hundreds of thousands of pounds as a result of the shortfall, and I hope that my hon. Friend has those figures.

Robert Goodwill: I will not bore the House by going through the entire list of local authorities that responded to our questionnaire to let us know their shortfall, but Shropshire is one of them.
	As well as providing us with financial information, some local authorities took the opportunity to vent their spleen. Bournemouth borough council said:
	"Again this government grabs the head lines giving out concessionary fares but do not fund it leaving councils to pick up the mess and move on."
	Medway council commented:
	"Local authorities are being forced to carry the burden for a government policy."
	That sentiment was also expressed by Worthing borough council. I have already cited the comments of Barnsley council, which is similarly dissatisfied.
	What has been the effect on the worst-affected local councils? Council funding of local bus services has had to be reduced. A number of councils have had to withdraw subsidy from socially necessary bus services that they paid for previously, so pensioners have a pass, but no bus to catch. In many rural areas, as my hon. Friends the Members for Shrewsbury and Atcham (Daniel Kawczynski) and for Macclesfield (Sir Nicholas Winterton) pointed out, there were no services anyway. To be fair, pensioners can use those passes further afield, but services such as dial-a-ride are under threat. The north-east passenger transport authority has had to cut concessions to young people and students.
	A large number of councils, such as Basildon, Cherwell, High Peak, Medway, Chelmsford and Canterbury, which had previously offered enhancements to the statutory minimum such as extended hours or companion tickets for carers, have been forced to withdraw those benefits and revert to the statutory minimum.

David Clelland: The hon. Gentleman is correct that in the first round of the new concessionary fares system, when it was restricted to localities, we had a problem in the Tyne and Wear area, and there were cuts to concessions for young people. However, the latest round of expenditure has meant that that can be reconsidered, which is happening as we speak.

Robert Goodwill: It is encouraging that the Government have been keen to bail out some constituencies in the north-east, but maybe they have not been quite so keen to help people in the south.

David Wright: Will the hon. Gentleman give way?

Robert Goodwill: I shall make some progress, if I may. I suspect that I anticipate the point that the hon. Gentleman wants to make.
	Secondly, councils are cropping other services not connected to travel to balance their books. A recycling programme in Christchurch has had to be scrapped as a direct result of underfunding for concessionary fares.
	Finally, a number of local authorities have been left with no option but to increase council tax. Adur in West Sussex, Worthing and Torbay are just three examples of that. According to a representative of Suffolk Coastal district council,
	"last year's Council Tax increase almost all went towards supporting the concessionary travel costs".
	The situation is little better for bus operators. Mr. Peter Shipp, the chairman and chief executive of the East Yorkshire Motor Services group, has described the situation as
	"even more of a financial and operational disaster than I predicted",
	and he certainly was not very complimentary about it before it was introduced.
	The new concessionary fare scheme is having a destructive effect on partnerships between local authorities and bus operators, which is jeopardising improvements to local networks. Bus operators have had to spend a considerable proportion of their time on concessionary fares administration and appeals—time that could more productively have been spent improving bus services. It is clear that the uncertainties of reimbursement are affecting the bus operators' attitude to risk, which may be reflected in tender prices for bus contracts.
	The principal bone of contention between local authorities and operators relates to calculating the so-called general travel factor, which means the travel pattern that would have been experienced without the concessionary fares. That factor is used as the basis of reimbursements paid to the operator. In many cases, that leads to appeals by operators. A bus operator can appeal if it feels that it has been inadequately reimbursed by the local authority, but it is worth noting that the local authority cannot appeal if it feels that it has been inadequately reimbursed by the Government. Will the Minister let us know how many appeals have already been lodged with her Department?
	Another common complaint is that whereas operators can increase fares without consultation, the grant awarded to local authorities to reimburse operators will increase only with inflation. If a bus company is in financial difficulties, it can raise fares. Because local authorities must reimburse it for revenue forgone based on a percentage of revenue, it will be the council that loses out.
	Mr. Shipp wrote to me at the end of May outlining the bureaucratic nightmare that is unfolding for companies such as his. He stated that one natural result of the new reimbursement arrangements is that he is paid a different amount by Scarborough borough council for a journey to Beverley than by East Riding of Yorkshire council for the return journey. Even worse, because East Riding is offering its residents a £15 pass to enhance the national scheme and provide pre-9.30 am travel to and from Hull, East Yorkshire Motor Services has to bill East Riding council for journeys made by its residents from Hull before 9.30 am, but Hull city council for the same journeys after 9.30 am. That is an example of the bureaucratic morass that such companies are having to deal with.
	Such companies are also finding that on sunny days, a large number of people entitled to concessionary fares are turning up for leisure journeys. All well and good, one might say, but as a result they are leaving regular fare-paying passengers behind because there is no room. Because of that, East Yorkshire Motor Services has just cancelled a £6,000 summer marketing campaign for fear of encouraging fare-paying families who would otherwise have been using their cars to turn up for buses that they cannot get on because they are full of pensioners.

David Wright: The hon. Gentleman mentioned the minimum standards that the Government apply nationally, and then he developed a theme of local problems in his speech. Does he believe that we should extend the minimum national requirements or keep local flexibility?

Robert Goodwill: It is important that, when local people vote for their councillors, they can vote for extensions to the scheme. I simply point out the bureaucratic difficulties that companies face through the anomalies that are thrown up. They make the scheme unpopular with some bus companies, which have to deploy their staff to administer the scheme rather than explore new services that they can provide or expand their businesses in the way in which they wish.

David Wright: The simple question is: what is the hon. Gentleman's proposal?

Robert Goodwill: We are not the party of government at this time. We are debating a scheme, which the Government introduced. The Select Committee has made some criticisms of it and it is only fair that the Government should respond to the points made in the debate. I simply make the point that companies throughout the country, not only in Yorkshire, are finding the scheme difficult to implement. Surely that cannot be laid at the door of the Opposition, who are not responsible for it.

Mark Hunter: The hon. Gentleman has been generous in giving way. He rightly said, in answer to the hon. Member for Telford (David Wright), that he does not speak for the party of government. However, will he confirm that he is not committing Her Majesty's loyal Opposition to any additional spending to bridge the gap on concessionary fares?

Robert Goodwill: We have made and continue to make the point that we feel that the funding that the Government have allocated—£214 million this year, increasing in future, with a total budget of approximately £1 billion for a billion journeys—is adequate for the scheme. The problem is its allocation to local authorities and the way in which some local authorities pocket a surplus and others, such as Worthing, which my hon. Friend the Member for East Worthing and Shoreham (Tim Loughton) represents, lose out. Those in Surrey have a surplus and I am sure that, although the authorities that labour under a deficit are knocking on the Minister's door almost every day, the ones that have a surplus do not do that.
	It is important to have equitable funding. I am not sure, even after reading the report, how the Government have arrived at some of the figures. Are they simply good guesstimates?

Tim Loughton: My hon. Friend has made it clear that anomalies already exist in the funding formula and they need to be addressed. However, he and others also clearly said that we proposed an amendment to the Concessionary Bus Travel Act 2007 to provide for an automatic review of the way in which the funding formula worked in two years to try to iron out some of the anomalies. Of course, the Government rejected that. They had an opportunity in the measure to ensure that the funding formula could be examined shortly. It is already going wrong, but the Government would not allow us to include in the Bill a provision for examining the matter in two years. Surely we have given that undertaking.

Robert Goodwill: My hon. Friend is right—we are locked into that. The Local Government Association has suggested a way in which the scheme could be improved.
	I would like the Minister to comment on some specific points, if possible. First, does she intend to tackle cross-border journeys in the United Kingdom? Hon. Members who have constituencies near the Welsh border have raised that point and the right hon. Member for Berwick-upon-Tweed (Sir Alan Beith) has raised the matter in the House in connection with the Scottish border. It can be frustrating for pensioners who live near a border and whose local market town is in a different country. Has the Minister managed to solve that problem? I will not admit to having any answers to that, but the matter has been raised and places genuine limitations on those living near the border. We must bear it in mind that we live in a United Kingdom, not separate countries.
	Secondly, will the grant—I believe that it is around £4.50 per pass—paid to local authorities for issuing passes be available for renewal after they run out in three years, or is it a one-off payment to local authorities for the initial issuing of the first passes?
	Thirdly, although we do not argue about the amount of the Government grant to fund the scheme, will the Minister carry out an urgent review of the allocation process, and possibly consider the Local Government Association's suggestion of distributing the grant on a per journey basis, as well as other solutions that could improve the scheme?
	For the avoidance of doubt and before any impulsive parliamentary candidates—I am not thinking of any party in particular—suggest otherwise, there is no threat to the pensioner bus scheme from an incoming Conservative Government. The biggest risk is that it may be compromised and undermined by the Government's inept introduction.

Richard Caborn: I, too, welcome the report and welcome my hon. Friend the Member for Liverpool, Riverside (Mrs. Ellman) to her position as Chair of the Committee. I know that she will do a sterling job in that post.
	On behalf of my constituency, I would like to make particular reference to paragraph 56 of the report, which is headed "Ticket gates—not the only solution". My hon. Friend will have received a letter from a Geraldine Roberts, who is the chair of the residents against station closures group, concerning Sheffield Midland station and the development there. Those who have had the opportunity—in fact, the pleasure—to come to Sheffield will have arrived at a station that has now been refurbished. The entrance has been developed and the walkway into the centre of Sheffield is now commensurate with a modern European industrial city.
	There is a problem, however, to do with revenue protection. The franchise that has been obtained by Stagecoach, in its bid for the east midlands franchise, is now creating problems in the operation of Sheffield Midland station. There have been two major developments in Sheffield, on each side of the station, one of which is the Park Hill flats. Those who come into Sheffield will know that the block has been there since the 1960s. It has undergone a massive refurbishment by English Partnerships and Urban Splash. On the other side of the station is Sheffield Hallam university, a very good university that is driving major parts of Sheffield's regeneration, part of which involves the creative industries quarter and the digital centre.
	The franchise said that gating could be installed, in order to protect the companies from fraud and the lack of fares, as well as to reduce crime. Both of those considerations we accept. However, we want a proper cost-benefit analysis, because the movement of population from one side of the station to the other is very much through the station—indeed, it is an historical fact of the development of Sheffield's railway network, city centre and university, as well as the residential area in and around Park hill. The point made in the report under "Ticket gates—not the only solution", which is a fair one, challenges some of the franchises that have been given out, particularly on the east coast main line. I hope that the issue can be revisited, as the report asks, to ensure that the cost-benefit analysis is done.
	The unfortunate part, which is again brought out in the report, is that many franchises have worked in isolation, taking into account just transport and not the wider concerns about economic regeneration or other developments. There are a number of such issues on the midland main line, which has problems with the gating at some of the stations.
	I welcome the report and its recommendations. I hope that the Government's response to the recommendation in paragraph 60 means that they will look not just at Sheffield, but at all the stations on the midland main line, to ensure that the cost-benefit analysis for all those areas is both effective and commensurate with the public money that has been put into the economic regeneration there, as well as into the stations themselves.
	Unfortunately, I have to speak just after 6 o'clock in another meeting, but I hope to return for the winding-up speeches, to listen to my right hon. Friend the Minister's reply, which I hope will be very positive indeed.

Norman Baker: I, too, welcome the hon. Member for Liverpool, Riverside (Mrs. Ellman) to her new role. I am very pleased that she is there, although obviously we all regret the circumstances in which she inherited it.
	To some extent, this debate is a revisiting of the debate that we had on 25 March about concessionary bus fares. It is not necessary to reiterate all the points that I made on that occasion, not least because some of them have been made already by the hon. Member for Scarborough and Whitby (Mr. Goodwill). However, I should like to stress the need for an evaluation, which the hon. Lady mentioned. The scheme is new and a lot of kinks and quirks have appeared, perhaps inevitably. It is very important indeed that there should be a proper evaluation, as she correctly said.
	When I asked for such an evaluation in the debate on 25 March, the Minister made no commitment to one. I therefore hope that she will today give a commitment to an early evaluation of the scheme, to pick up the legitimate points made by hon. Members in all parts of the House about how it is operating. Like most hon. Members, I make that call not out of mischief, but because there are genuine problems and kinks in the scheme as it is currently working. If the hon. Lady's Committee can pursue that point, that would be very welcome indeed.
	Part of the conclusion that I have reached from writing to all transport authorities that administer a concessionary fares scheme is that there is a misallocation among authorities, which means that some have received grossly inadequate amounts for the schemes in their area. That is particularly the case for seaside towns and attractive areas such as Lewes, which is considerably out of pocket, as well Worthing, which has now been mentioned for the fourth time in this debate. However, some authorities have been gaining money for which, frankly, there is no justification. Obviously those authorities keep quiet about that; nevertheless, there is an imbalance in the way in which the money is distributed.

Mark Hunter: My hon. Friend is right to draw attention to the problems in funding the scheme. However, does he agree that another important consideration is that in many cases passenger transport authorities have underestimated what their response to the scheme should be? For instance, Greater Manchester passenger transport authority has been totally overwhelmed by the number of applicants for the new passes. As a consequence, many residents are still waiting for their passes, and will be waiting for another several months.

Norman Baker: My hon. Friend is absolutely right. Many local authorities were not entirely ready for the scheme when it was introduced, but that was not necessarily their fault. It is a question of how the scheme was rolled out, the availability of smartcard technology and other matters, which I shall come to. However, we have not yet seen the full picture, which is perhaps another reason for a full evaluation.
	It is quite clear from the responses that I have received—I imagine that this is true of the responses that the hon. Member for Scarborough and Whitby has received, too, as I suspect that local authorities are saying the same thing to him as they are to me—that there is an overall deficit in the amount of money that councils require to run the scheme on a cost-neutral basis. Part of the reason for that deficit is that the Government have been successful in their concessionary fares scheme. They have encouraged more people to use public transport and, by getting people on to buses, met some of their objectives on social exclusion and even, one might argue, on climate change.
	The Government can say, "Here is a success," but they cannot say that there is no extra cost to councils as a consequence. I estimate that cost to be around £60 million per annum overall, even allowing for the redistribution of funds between those who have gained and those who have lost. I have talked to our shadow Chancellor, my hon. Friend the Member for Twickenham (Dr. Cable), who is a hard man to get money out of. He has agreed, in our overall tax-neutral arrangements, that £60 million extra will be allocated for concessionary fares in our Budget proposals.
	I invite the Conservatives to follow suit. We have as much opportunity to speak from the Opposition Benches as the hon. Member for Scarborough and Whitby has. It is not sufficient in opposition merely to draw attention to the Government's deficiencies; it is necessary to put forward constructive alternatives, too. Although the Conservatives are getting quite good at pulling apart the Government's proposals, they are not very good at putting forward any alternatives.

John Redwood: On that point, could the hon. Gentleman remind us how big a local income tax would be needed to balance his Budget?

Norman Baker: This is not a debate about local income tax, but I am happy to tell the right hon. Gentleman that all our tax proposals balance. I would be happy to send him details, should he wish. Our proposals are open and accountable, they have been externally audited and they balance. More to the point, they exist, which is more than can be said for the Conservatives' proposals.
	I am grateful to the Committee for its comments on the concessionary fare scheme, and I hope that it will follow them through, because this is an important area of delivery not only for people up and down the country but for the new Government policy, which needs to be examined. That is exactly the sort of thing that the Committee should be doing.
	The report is not just about concessionary fares; it also deals with other matters. The hon. Member for Liverpool, Riverside mentioned fare evasion, which is an important issue. I support her suggestion that there should be a better independent appeals body. It is quite right that those who are seeking to avoid paying their fare should be caught and dealt with properly. It is unacceptable to the proper fare payer that others are getting free travel by seeking to avoid payment. However, people are sometimes given unjustified penalties. A constituent of mine, a young student, got on a train without having paid the fare because there was no one in the booking office. They were subsequently charged a penalty fare because they had not seen the conductor on the train to get a ticket as soon as they got on. That cannot be right, and we need to resolve issues such as those. An independent appeal body that works would be the right way forward, and I fully endorse the hon. Lady's proposal for such a body.
	One way of dealing with such problems is by gating stations. I do not pretend that that is the full answer, but I know from speaking to Transport for London that it has massively increased its fare income—by 15 to 20 per cent., I think—by putting gates on the North London line, which it has taken over from a British Rail-type body. I am not sure which of the train operating companies it was. TFL has improved its income stream markedly by gating those stations. Technology can therefore help to provide answers.
	I want also to deal with integrated ticketing, but I shall preface my remarks by saying that we need to recognise that there is a problem with the bus services that are provided in this country. The problem dates partly if not wholly back to deregulation in the 1980s. The statistics from the Department demonstrate that the average cost of bus fares has increased markedly above inflation in the intervening years, and particularly since this Government came to power in 1997. The average cost of bus fares has increased by 13 per cent. above inflation since 1997.
	Those who use buses are often among the poorest in society. They do not all qualify for free passes as they are often working people, and this is a significant cost for them to meet. The cost of travelling by bus has gone up by more than the cost of travelling by train and, dare I say it, by more than the cost of motoring in those years, notwithstanding recent fuel price increases.
	The cost of travelling has gone up, but the cost of subsidy has gone up as well. The subsidy to bus services in 1986 was £847 million. When this Government came in, it was largely unchanged at £881 million. By 2006, however, it had rocketed to £2,452 million. That represents a tripling of the subsidy in the 11 years of this Government, at a time when fares have been increasing at above the rate of inflation and bus passenger numbers have continued to fall. That is not a success. Between 1985 and 2006, the number of bus journeys in Scotland fell by 30 per cent., in Wales by 28 per cent. and in the non-metropolitan areas of England by 22 per cent. It is only in London that there has been any success in driving the numbers up. The subsidy per head in London is markedly higher than elsewhere in the country.

David Clelland: Will the hon. Gentleman give way?

Norman Baker: In a moment.
	A further element of the equation is the fact that the profits of the bus companies have rocketed over that period. Therefore, we have seen rocketing profits for bus companies, rocketing fares for passengers, rocketing subsidy by the taxpayer and a decrease in services and passenger numbers. That is not a success story.

David Clelland: The hon. Gentleman has just made the very point that I was going to raise, in recognising that the profits of the bus companies have indeed rocketed in that period. What proposals does he have to deal with those rising profits and with falling bus ridership?

Norman Baker: To be fair to the Government, they have started to go along that track with their proposals in the Local Transport Bill. They will make it easier to bring in quality contracts and give local authorities more control over the type of bus operations in their area. We would go further than the Government are going, however, and I have tabled amendments to the Bill to try to achieve that, as the Minister knows. Collectively, however, we all have to recognise that the statistics that I have just given demonstrate a failure of bus policy over 20 years, and unless there are proposals to remedy that—such as those that we have put forward and, to some extent, those from the Government, though they are not enough—the failures, including decreasing patronage and increasing costs, will continue. That cannot be sensible.
	The report refers to integrated ticketing, which is an important issue. It is easier for people to use public transport if their tickets are integrated. They want to be able to buy just one ticket for their whole journey. Integrated ticketing also helps to avoid extra costs. The hon. Member for Liverpool, Riverside rightly drew attention to the fact that people often have to buy multiple tickets, which drives up the cost of their journey. Even in London, someone who gets off one bus and gets on another has to pay again, until they have reached the ceiling on their Oyster card.
	The fact is that no real attempts are being made to make integrated ticketing work. Paragraph 1 on page 30 of the report states:
	"Ten years after it expressed its commitment to promoting integrated bus ticketing, the Government has achieved too little of practical value. It is a nonsense that the everyday act of changing buses is still made unnecessarily inconvenient and expensive by poor ticketing arrangements. The Government needs to pay more attention to resolving these basic problems which penalise passengers and deter others from using buses at all."
	That is absolutely right, and the Committee is right to draw our attention to that point. However, I do not see much in the Government's response to suggest that they are taking it on board or that anything is going to happen as a consequence.
	The Government talk about the voluntary schemes that are working, including plusbus. They are indeed working, and I am glad that plusbus is there, but less than a quarter of rail tickets that are sold have any sort of cross-ticketing arrangement with buses. More than 200 towns and cities outside the metropolitan areas are covered by the scheme, which is fair enough, but there are many areas that are not covered. It is not sufficient to rely on local initiatives to make up the difference. It would take a very long time to achieve that, and the Government need to be more proactive in encouraging integrated transport ticketing, between rail and bus services in particular, but also between bus operators.
	I have to tell the hon. Member for Liverpool, Riverside that we have tabled amendment after amendment to the Local Transport Bill to try to make integration part of the thought process. For example, we wanted to make it a requirement for those involved in local quality contracts to consult Network Rail and the train operating companies, but that proposal was rejected by the Government, so our proposal to help to achieve integration was actually voted down by her colleagues. I hope that she will take that up with the Minister at some point.
	Integrated ticketing will be helped by the roll-out of smartcard technologies, and I think that we are all in favour of that. We have only to look at London to see what a great success the Oyster card has been. Incidentally, I hope that we will soon reach the stage at which Oyster cards can be used on mainline suburban rail services as well as on the underground. Not all train operating companies accept them, but I hope that that can be rectified before long.
	The fact is, however, that 78 per cent. of travel concession authorities do not comply with ITSO standards. By the end of 2008, only 5 to 10 per cent. of the bus fleet will be ITSO equipped. Therefore, we have a situation in which people who are being given smartcards cannot use them because there are no facilities for them on the buses. In an answer to the hon. Member for Manchester, Blackley (Graham Stringer), the Minister said:
	"We currently have no plans to require buses in England to be equipped with smart readers."—[ Official Report, 22 October 2007; Vol. 465, c. 17W.]
	That is the official Government position, but I have to ask why there are no such plans. This is the way forward for dealing with all the problems that the Transport Committee has identified, and for getting justice and ease of use for the passengers who want to use the buses.
	I want to ask the Minister a direct question, and I hope that she will answer it when she winds up the debate. How much does she estimate it would cost to put smartcard readers on all buses? I understand that the Department for Transport has made a rough estimate of the cost, but we have failed to see answers to these questions so far. She doubtless shares our vision that that system should be rolled out, so, having given us an estimate, will she tell us how she thinks that the system should be applied to buses? In her judgment, who should pay for it?

David Clelland: Having acknowledged that the bus companies are making massive profits, does not the hon. Gentleman think that they ought to make a contribution to that?

Norman Baker: I do as a matter of fact, because it is in the bus companies' interests to do so. There is a need to reverse the decline in bus patronage, and they ought to realise that it is in their own interests to do so. It is also in the interests of all those who believe in tackling climate change, including the Government, who must lead the process and explain how it can be achieved. Simply standing back and saying, "We'll let the market sort it out," does not work; we need more Government intervention and leadership.
	I understand that ITSO-based smartcards are being used much more in Scotland and Wales. I do not know how they have managed it—perhaps the same way that railway lines have been re-opened in Scotland and Wales, but not in England. Transport needs south of the border seem to be different from those north and west of the border.
	I hope that the Minister will be able to say something very much along the lines of integrated ticketing, and something about how she intends to enable a person who turns up at Lewes railway station, for example, to get a train to Brighton and then a bus from Brighton to wherever they are going.

Tim Loughton: Worthing.

Norman Baker: Perhaps to Worthing, who knows? They can of course get a train to Worthing, changing at Brighton. There is a good service.
	How will the Minister facilitate such journeys? How are they going to happen? Who is going to drive the process whereby somebody says at a train station, "I want to get off at this particular bus stop," and they receive a ticket? It is our ultimate goal. I suggest to her that the Government must lead that process, and that it requires the roll-out of smartcard technology and readers on buses, and the availability of a type of Oyster card throughout the country, not just in London. Why should London get the benefit of a good system when it is denied to the rest of the country?

Daniel Kawczynski: My hon. Friend the Member for Scarborough and Whitby (Mr. Goodwill) made a very good speech highlighting some of the deficiencies in the Government's concessionary travel funding for local councils. I applaud the fact that he has raised the issue, because Shrewsbury and Atcham borough council has been grappling with it for a long time. When he raised it, various Labour Members tried to suggest that we were making party political points, but it is a genuine issue, and my local council's finance director, Mr. Campbell Thomson, has written to me on more than one occasion to highlight the deficiencies—the big gaps—in Government funding. The council has to find funding from elsewhere to cover the concessionary travel scheme, and it is running to hundreds of thousands of pounds. That is a point well worth making, and I hope that the Minister will assure us of increased funding for Shrewsbury and for Shropshire.
	We will have a unitary authority—I fought tooth and nail against it—as of June next year. It will cover the whole of Shropshire, apart from Telford, and I shall be watching carefully to see how much the authority receives for the concessionary travel scheme, that the amount is adequate and that local taxpayers in Shropshire do not have to cover the difference.
	I want to highlight for the Minister some specific points about Shropshire. Shropshire has a much higher percentage of over-85-year-olds than anywhere else in the country, and Shrewsbury has been voted the number one retirement destination in England, because it is such a beautiful town. [ Interruption.] It is much nicer than Worthing. I want the Minister to take that into consideration, because with so many senior citizens in Shrewsbury, the travel scheme will be even more popular.
	The Minister will know just how rural Shropshire is. There are some very big distances between the many villages in my constituency and the county town of Shrewsbury, and as I said in an intervention on the hon. Member for Liverpool, Riverside (Mrs. Ellman), we have a genuine problem with the growing number of bus services that are being cut in rural Shropshire. I say so impartially again. Just last week, a delegation of senior citizens from the village of Pontesbury highlighted yet another bus service that, regrettably, must stop. They are obviously determined to ensure that I campaign to try to save it, so I should stress to the Minister that, although I applaud her Government for having introduced the concessionary scheme, and I rarely praise socialists or indeed this socialist Government, the scheme must be funded properly and there must be special, extra help for rural areas such as Shropshire, which have large numbers of senior citizens.
	My hon. Friend the Member for Scarborough and Whitby also mentioned the important issue of cross-border traffic. Shrewsbury is a border town—my constituency ends on the Welsh-English border—and many constituents on both sides of the boundary travel backwards and forwards across it. Shrewsbury is the main destination for many people living in Wales who travel across the border from villages to shop there, and they also use vital services in Shrewsbury. There are no major hospitals in mid-Wales, so they use the Royal Shrewsbury hospital. They also use education services. I noticed that when that point was made, the Minister looked somewhat perplexed, because the issue is very thorny and potentially costly. However, as my hon. Friend said, we live in the United Kingdom. We live in one country, and some of us feel very passionately about that, so we want to ensure that citizens—our constituents—on either side of the border, living cheek by jowl, are not discriminated against because they live on the wrong side of it.
	In preparation for the debate, I met representatives of the Shropshire Disability Forum. Mrs. Sue Wood, who runs it, wanted me to raise the following issue with the Minister. I do not know whether things have changed since Mrs. Wood acquired this information, but she is under the impression that the concession is available only after 9.30 am. I agree with what was said earlier. Local councils should have the freedom to decide some of the scheme's nuances, and no mandate from central office—I mean central Government; there's a Freudian slip—should dictate that everything be done uniformly. The Opposition are always calling for local flexibility, but I very much hope that the Minister will assure us that there will be certain guidelines for councils. It would be rather iniquitous for any council to allow a disabled person to use the scheme only after 9.30 am if that person were trying to get to work. Very few people whom I know start work at 9.30 am. [ Interruption.] The Minister says that it is up to the councils, but I am asking her whether there are any guidelines.
	I turn to the most important part of my speech. I should like to inform the Minister that the largest organisation in my constituency is the Shrewsbury Senior Citizens Forum, which has 5,000 members and is rapidly becoming one of the largest senior citizens organisations in the country. It liaises with other senior citizens forums throughout the country, and a few months ago, it organised a national conference in Shrewsbury, with organisations throughout the country attending to debate various senior citizens issues. Bill Harris, the organisation's eminent chairman, would like to meet the Minister to discuss some of the concessionary scheme issues that the forum thinks are important. I very much hope that rather than just talking to politicians such as me, she will take an interest in that body and extend an invitation to its members. I could bring them to the House to meet her, so that she could hear about the issues directly from them.
	After having campaigned for almost four years for a direct rail service from Shrewsbury to London, I am delighted to inform the House that we finally have the link. It is hugely important for Shropshire and for business investment. Obviously, a lot of senior citizens will want to use the service; I am constantly asking senior citizens in my constituency to do so. I hope that the Minister will give me an assurance on what programmes or Government incentives there are for train operators to have the most imaginative and innovative policies for senior citizens. She may think this an outlandish suggestion, but perhaps there could be Government awards or a national competition for train operators. In that way, we would know which United Kingdom train operator had brought out the most innovative and imaginative schemes to get senior citizens on the trains and give them the best concessionary fares.

Robert Goodwill: I nominate Grand Central Trains, which is running a new service from Sunderland to London via York. The service offers half-price fares for pensioners and gives a 50 per cent. refund if a person cannot get a seat on the train. That is another interesting idea, which operators in the south-east of England might consider—although it might bankrupt them.

Daniel Kawczynski: I am sure that the service is very good. I would like to nominate the Shrewsbury to London train service, on which some good schemes for senior citizens are already starting.
	My point to the Minister is made sincerely. She will agree that it is important to get train operators to compete with one another to show that they are serious about concessionary fares for senior citizens.

David Wright: rose—

Daniel Kawczynski: I give way to my constituency neighbour, with whom I share a 50-yard border.

David Wright: I am grateful to the hon. Gentleman, whom I would call an honourable friend on this issue. I agree with him about the service between Wrexham, Shrewsbury and Telford. Is he aware that the service is providing a superb improvement for wheelchair users? A constituent of mine recently told me that he caught the train from Telford and that the new company provided a fantastic return service between Telford Central station and Marylebone. It was fantastic, and there has been a significant improvement for wheelchair users who want to use the service from Shropshire. I am sure that the hon. Gentleman will join me in congratulating the company on that.

Daniel Kawczynski: Yes, I absolutely join the hon. Gentleman on that. Interestingly, I have also heard positive comments from wheelchair-using constituents who have used the Shrewsbury to London service. The attitude of the people operating the trains in dealing with people in wheelchairs is critical. In the past, I have had complaints from wheelchair users about how they were treated by train operators, and that is regrettable. The hon. Gentleman is right about the new operator of the Wrexham-Shropshire-London service. It has won awards and I congratulate its staff for the empathy, kindness and professionalism with which they deal with senior citizens and wheelchair users.
	I conclude by reiterating to the Minister that I hope that she will come to Shrewsbury and meet the 5,000-strong Shrewsbury Senior Citizens Forum to hear its views about the future of concessionary bus travel.

Tim Loughton: I had not intended to speak in this debate, but I have been goaded—not least by the lack of mention of my constituents, particularly those in Worthing. I thought it might enlighten the House if I discussed the experiences of my local councils and my constituency. I repeat the welcome given to the hon. Member for Liverpool, Riverside (Mrs. Ellman) and commend her Committee's report, although it was produced under the chairmanship of the late former hon. Member for Crewe and Nantwich.
	I take issue slightly with my hon. Friend the Member for Shrewsbury and Atcham (Daniel Kawczynski), who tried to claim that his constituency had the highest number of pensioners. Although not now No. 1 in the pensioner stakes, Worthing still has, proportionately, the highest number of over-85-year-olds, who form 4.6 per cent. of the population. We greatly appreciate the contribution that they make to our town. They seem to travel on buses disproportionately more than other members of the community, so our getting this issue right is of particular relevance to them.
	Although I greatly welcome the scheme and supported the Concessionary Bus Travel Bill that brought it in, there are clearly winners and losers. The Government have increased the funding to £1 billion. I am not trying to detract from the generous funding that they have made available, but whatever one thinks about the funding, the issue is whether it is going to the places it is needed most and whether it reflects the usage of buses by local populations. I have a problem in that regard.
	Worthing borough council and Adur district council, the two local authorities in my constituency, have been working in ever closer partnership. That has been greatly encouraged by the Government and it is to be applauded; it has produced many efficiency savings. However, those savings and more have gone out of the window because of the necessity of subsidising a scheme that the former Transport Minister, the hon. Member for Lincoln (Gillian Merron), made absolutely clear on 28 June 2007 would be fully funded. Overall, that may be so—it is too early to tell—but in Adur and Worthing it is anything but fully funded.
	The Minister knows that full well because, in her absence over Christmas, I took a delegation to see the Minister for Local Government, the hon. Member for Wentworth (John Healey), and I had a follow-up meeting with her later. She has had a number of detailed representations from council leaders, council officers and the two Members of Parliament representing the Adur and Worthing authorities. She is in no doubt about the problems that the scheme is causing us.
	I will cite the figures: the estimate is that there will be a shortfall of between £600,000 and £650,000, possibly in Worthing alone. In Adur district next door, the shortfall for this year has been estimated at £238,000, which is equivalent to 4.3 per cent. on the council tax. The council leader has estimated that if we had not had to subsidise this supposedly fully funded Government scheme, we virtually need not have increased council tax this year at all. All the other savings that have been made have been wiped out by the additional costs of the scheme, which have fallen on Adur council tax payers; the scheme has not been fully funded as the Government had claimed.
	There are winners and losers among the 324 authorities that are operating the scheme. There are particular losers among authorities that include resorts, particularly seaside resorts, that rightly attract people on day trips or short-stay holidays. That is why Sussex, which has a number of seaside resorts, has been disproportionately hit. I repeat that the scheme is good, but it has already become subject to the law of unintended consequences, and that is having a detrimental financial effect on my councils and therefore my council tax payers. Sarah Gobey, the assistant director of financial services at Worthing council, has provided me with a brief. She writes that Worthing borough council
	"is extremely disappointed to see that the Department for Transport is only willing to consult on proposals to distribute the grant on a formula basis. At this early stage in the scheme it is almost impossible to derive a formula which will match the pattern of actual costs—the empirical information is simply not there."
	I should remind the House that the Government adopted a reimbursement formula based on a combination of eligible population, bus passenger journeys, overnight visitors and retail floor space—a very difficult calculation to make.
	Sarah Gobey went on:
	"This Council would prefer to see the grant paid to reimburse the actual additional costs experienced at a local level. This would ensure that there are no 'gainers' or 'losers' in the new system. The preliminary forecast received from the Council's consultants would indicate that whilst Worthing will be a 'loser' under the proposed arrangements, other Councils within West Sussex would appear to 'gain'. We fail to see how this can be justified, yet the Department for Transport refuses to see why using a formula to distribute the funding is flawed. The Government has told local government that there is sufficient funding available for the new scheme, consequently there is absolutely no rationale in allocating grant on any other basis than actual expenditure."
	The situation, however, is actually worse than that.
	For the past few years, again to their credit, the Government have been operating a free local bus pass scheme, but its operation and funding have been to the detriment of my councils. The note continues:
	"However, all of this masks another problem which is that the Council believes that the current statutory scheme is also underfunded. By 2008-09, the Council estimates that the cost of the current scheme will have increased by £860,000 since the introduction of the free bus pass. In 2006-07, the Council received additional funding of £610,000 via Revenue Support Grant. As a 'floor' Authority, this funding has barely kept pace with inflation, whilst over the same period the Council has seen costs increase by over 20 per cent. per year. Consequently, the Council estimates that the current scheme is underfunded by at least £200,000."
	On top of the additional underfunding element of the national bus pass scheme, we have been accumulating losses on the existing local scheme. So there has been an accumulation of losses over some years, to which the national bus scheme is a further addition. It is a double whammy. As Sarah Gobey concludes:
	"There is the distinct possibility of financial meltdown for Worthing Borough Council for the sake of a formula and it is particularly galling to think that all of our hard work on achieving savings from partnership working"—
	with Adur—
	"could be wiped out at a stroke."
	That briefing came from Worthing, but the same principles apply to Adur council next door, which is a slightly smaller one whose total figures are slightly lower.
	The Government announced this scheme to great acclaim and we all support it and want to see it flourish because it is good for transport, good for the environment and, most of all, good for elderly and disabled people who can travel more, but it is clearly having a very detrimental effect as certain councils, particularly mine, are suffering from a large shortfall.
	That explains why certain councils, including mine, have chosen to time their scheme so that it starts at 9.30 am rather than at 9 o'clock, as 9.30 is the latest allowable time for authorities to commence the scheme. Some neighbouring councils, which are not suffering from the same shortfall, have been able to start their scheme from 9 o'clock, so further confusion is ensuing. My local councils are, quite understandably, trying to limit the impact that the shortfall in funding is having by just about the only mechanism available, which is to start the scheme at 9.30 rather than earlier.
	Now, however, we have people travelling between local authorities whose start time is different, which is causing a good deal of confusion and no little resentment by some people who think that certain councils are pulling a fast one. Well, if anyone is pulling a fast one, it is the person who invented this funding formula, which is leading to serious underfunding for my councils, which are then quite unreasonably getting the flak for what is happening.
	As my hon. Friend the Member for Scarborough and Whitby (Mr. Goodwill) said, the scheme has also been a victim of its own success, as there has been a big increase in the number of bus journeys. On the face of it, that is absolutely right, and I see many people around Worthing getting on buses, so the buses are being well used. I have to say, however, that many of the people who get on those buses do not get off them —[Interruption.] The Minister might say "Not ever", but there have been a number of cases involving people who, knowing that they can travel for free, get on the bus and travel all the way down the coast to Chichester or Lewes or perhaps on to Hastings or wherever without getting off. They go for the trip. That is terribly nice and lovely, but they do it again the following day and the one after that and the one after that. Bus drivers now have regular customers who travel on the bus for the sake of it. That may not be typical, but some people are making use of the system, travelling up and down the coast and having a lovely ride. To be honest, that is not the purpose for which the scheme was intended.
	I have another extraordinary situation in my constituency. There is a residential building of about 90 sheltered flats where a number of pensioners live. It is very well run by the local housing association. It is on a busy road just on the outskirts of Worthing. The bus going into town picks up pensioners from that building so that they can do whatever they want to do in Worthing. When they come back, however, the bus stop is on the other side of the road, but the road is so busy that many of these pensioners are too scared to cross it, so they stay on the bus, travel several more miles into the next town until the bus turns around and comes all the way back in order to deposit them on the right side of the road. That seems absurd, but it is happening. It provides another example of excessive bus journeys, which have to be accounted for by the local bus company. I am trying to address the problem by getting the local authority to put a pedestrian crossing of some description on that part of the road, which should help.  [Interruption.] The serious point I am making is that many more people than were ever anticipated are using the buses; and I have to say that it seems to be happening to a greater extent in Worthing and Adur than in other parts of the country, which exacerbates the problem of the number of journeys and the underfunding.

Norman Baker: rose—

Tim Loughton: I am sure that the same applies to Lewes, so I give way to the hon. Gentleman.

Norman Baker: Well, Lewes is a nice place to get off. Has the hon. Gentleman seen a copy of Scotland's  Sunday Post, which drew attention to a different sort of problem with bus journeys? Operators were said to have given out tickets to passengers for the entire length of a journey, knowing that they would be getting off after a couple of stops in order to claim back a higher rebate.

Tim Loughton: I am afraid that I have not seen this week's  Sunday Post, which is very remiss of me, but again, that is not an isolated incident, as there are many concerns about the accuracy of ticketing.
	Finally, the other problem looming is the cost of the scheme, inflated by additional passengers, to bus operators themselves, as they face the double whammy of increased petrol costs and so forth—irrespective of whether the buses are run on recycled chip fat or whatever other wonderful environmentally friendly schemes are happening—because local bus companies are increasingly appealing against local authorities on the amount they can claim for bus fares.
	The scheme is very good and well intentioned, but it is facing real problems. That is why, when my local authorities went to see the Minister, they basically said, "Great scheme, but we don't want to run it. We want all our council tax payers to have the benefit of it, but we don't want our council tax payers to have to pay for it as well, given that this is supposed to be fully funded." My local council leaders would prefer the scheme to be taken out of their hands and to be run nationally or by some other body— [Interruption.] This may well appear to be "Stalinist" to the hon. Member for Telford (David Wright), but I do not often hear him or members of his party speaking up against Stalinism.
	The problem is this: why should my council tax payers in Worthing and Adur have to pay for a scheme that is supposed to be fully funded by the Government? As I have explained, the councils are saying that the scheme is great, but they do not want to have to run it and pick up the tab. The Government have to acknowledge that however well intentioned the scheme, and whether or not £1 billion is or is not sufficient to run it nationally, in certain parts of the country—Adur and Worthing are not untypical—councils are having to pay a substantial amount to run it. I urge the Government to look again at the formula and see whether they can better reflect journey usage. They need to refine the formula and ensure that a good scheme does not become a victim of its own success, leading to the law of unintended consequences, whereby my council tax payers effectively have to pay twice. I am not saying that I want the scheme reduced in any way. I want to ensure that it achieves its intended purpose of enabling more pensioners and disabled people to get out of their houses, use essential services or go out for pleasure journeys or whatever; at the same time, however, it should not be unfair to other council tax payers who have to foot a bill—in the case of Adur, a bill of 4.5 per cent., which could have wiped out the council tax increase this year.
	I urge the Minister to think again about enacting a review of the formula, in no more than the two years suggested by my colleagues when the Bill went through the House last year. Will she consider doing so more urgently, to ensure that moneys are being fairly distributed where they are needed for the scheme, and that councils are not pursuing a profit-making venture, which was not the Government's intention?

Rosie Winterton: This has been an excellent debate on a good and interesting report. I pay tribute to the Transport Committee for considering integrated ticketing and concessionary travel. The report was carried out when Mrs. Dunwoody was the Committee's Chairman, and it is a great tribute to her that she wanted to consider the subject, which might not appear to be at the heart of transport debates. Such issues are incredibly important, however, especially if we wish to increase the use of public transport. I also congratulate my hon. Friend the Member for Liverpool, Riverside (Mrs. Ellman) on taking over the chairmanship of the Committee. She is already making great strides, as we all expected that she would, in ensuring that the Government's transport policies are properly scrutinised.
	I hope that right hon. and hon. Members will feel that the Government's response to the Committee has been helpful and constructive. As I shall outline, we have taken on board the Committee's recommendations in a number of areas and, in some instances, have agreed with the Committee where it said that we are taking the right approach. We should not overlook ticketing, which is an important aspect of public transport.
	As Members have said, the Oyster card in London has shown the potential of smartcards both to speed up and simplify journeys. In addition, the sale of rail tickets over the internet and the introduction of advance ticket machines have freed up railway staff to do other jobs, particularly helping out passengers on the concourse or platform. My hon. Friend the Member for Telford (David Wright) said how important it was that staff were able to help people with disabilities. Many of the new technologies available in the world of transport have the potential to revolutionise public transport.

Louise Ellman: Although I endorse my right hon. Friend's statements about the benefits of technology, does she agree that technology should not be an absolute substitute for people, who are there to help passengers?

Rosie Winterton: I certainly agree with that. We have discussed today the need to ensure that people can navigate their way around the system using new technology. Of course, people need assistance to do that, but at the same time staff can be freed up to undertake other duties.
	The Government are committed to ensuring that ticketing choices are fair, transparent and convenient, as my hon. Friend said. Last year's White Paper, "Delivering a Sustainable Railway", set out our vision of simpler fares, modernised ticketing and information, and how best to meet the needs of disabled passengers. In April, we welcomed the announcement by train operators of the new, simplified and more transparent fares structure to be introduced next year. In May, the operators introduced standard names and conditions for advance fares, increasing the availability of railcard discounts. From September, the names of the main walk-up fares will be common across the whole network, so they will be easier for passengers, and Members of Parliament, to understand.
	The Government recognise, however, that the arrangements for bus ticketing are not so well advanced. We want integration not only on the railways, but on buses. We understand the importance of a simple and flexible integrated approach. We should remember, however, that bus operators often work in a commercial world, and are free to set their own fares and determine conditions on ticket validity.
	I was pleased that my hon. Friend the Member for Liverpool, Riverside spoke about the importance of the price promise for rail. I shall refer later to the Local Transport Bill. With the agreement of the Association of Train Operating Companies, we plan to introduce a price promise, whereby anyone who buys a train ticket in person from a ticket office and who subsequently discovers that they could have bought a cheaper ticket for the same journey will be entitled to a refund of the difference. That was a concern of the Committee.
	My hon. Friend also emphasised the importance of community transport. I absolutely agree with her. More quality partnerships and, if necessary, quality contracts are needed. In that way, it could be easier for local authorities in some instances to insist on integrated ticketing. I am sure that she needs no reminder that those on the main Opposition Front Bench have consistently voted against the changes in the Local Transport Bill— [Interruption.] I said those on the main Opposition Front Bench. It is astonishing that they have done so, because Conservative councillors have said that Opposition Front Benchers are totally out of touch with local authorities, which need the ability to work more closely with bus operators and to introduce quality contracts if that is the right approach. Conservative Members shake their heads, but I suggest that they consult more closely the councillors in their areas. If they do so, they will find that those councillors are reflecting what the public are telling us as Members of Parliament: they want better bus services. We intend to introduce those through the Local Transport Bill. I urge those on the Conservative Front Bench to take heed of that.
	Following on from my hon. Friend the Member for Liverpool, Riverside, my right hon. Friend the Member for Sheffield, Central (Mr. Caborn) made an important point about gating. Of course, we need to protect revenues, and gating can be an important part of that. However, I assure my right hon. Friend that we would not expect a station operator to install gate lines outside the boundary of the station lease, or unreasonably to restrict access to a pedestrian route shared with other facilities. I am sure that, having heard my right hon. Friend's speech, my hon. Friend the Under-Secretary will consider the points that he made.

Richard Caborn: The Select Committee report called for a more holistic policy on gating, which may involve economic regeneration and other factors. "Holistic" is a lovely word that encompasses everything, and I am therefore hopeful of a solution to the particular problem that I am experiencing in Sheffield.

Rosie Winterton: I am sure that my hon. Friend the Under-Secretary will raise that point with the train operating companies.
	Some £1 billion is being spent on concessionary travel, which was mentioned by many Members. I hope that they will rejoice in the fact that people over 60 and eligible disabled people can now use their bus passes anywhere in the country. That gives older people enormous freedom, but I sometimes feel that certain Members are a bit grudging in their support for it. We have allocated an extra £212 million for 2008-09, rising to £217 million and £223 million in the following years, to travel concessions in England. That is enough to fund about 200 million additional bus journeys in local authority areas across England.
	When we consulted local authorities on how the scheme should be extended, they asked us to provide a special fund rather than allocating money through the rate support grant, which we agreed to do. We then consulted the authorities on how they wanted the money to be distributed, giving them four or five options, and we have since distributed it on the basis chosen by most of them. I can tell our seaside colleagues, the hon. Members for Scarborough and Whitby (Mr. Goodwill) and for East Worthing and Shoreham (Tim Loughton), that the allocation took account of the number of overnight visitors, which is greater in some areas. I think that local authorities should welcome the fact that they can attract visitors, because of the knock-on effect on their local economies. Although some welcome it, others sometimes complain.

Tim Loughton: I hope the Minister recognises that I was in no way grudging about the scheme. We certainly welcome visitors to Worthing and Adur, both tourists and others. However, I should like to know how she calculated the number of additional visitors to Worthing who were likely to take advantage of the scheme. The figure is entirely arbitrary, and we are not convinced of the exactness or the rigorousness of the formulae that the Government used.

Rosie Winterton: As the hon. Gentleman probably knows, there are clear mechanisms for local authorities to submit returns about their visitor numbers and available retail space. It is not for the Department to tell Worthing how many overnight visitors it has; it is for Worthing to tell the Department. I should have thought the hon. Gentleman knew that.
	Of course we believe that bus operators are entitled to reimbursement for carrying concessionary travellers, but local authorities should provide it on a "no better off, no worse off" basis: operators should neither gain nor lose money as a result of carrying concessionary travellers. That is laid down in legislation. It is important for authorities to reach agreement with operators on how they should be reimbursed in relation to the numbers carried.

Louise Ellman: There is clearly overwhelming support for the concessionary scheme. Will my right hon. Friend undertake to re-evaluate the way in which it is working and, in particular, examine the allocation of available funds to ensure that it remains universally popular?

Rosie Winterton: The issue has been raised by a number of Members. The hon. Member for East Worthing and Shoreham, for instance, said that his local authority did not necessarily want to participate. Some smaller district councils have said that they would prefer the county councils to carry out this function. We said in our response to the Select Committee report that, later this year, we would consult on whether the function of district councils should be transferred to county councils.
	As I am sure Members will appreciate, the matter is not necessarily as clear-cut as it may seem. The concessionary fares element represents a considerable part of the budgets of some district councils.. A number of issues need to be taken into account as we move from a system that includes an element of rate support grant to a new system, but we have said that we will consult on it.

Tim Loughton: Worthing invited officers from the Minister's Department to open the books and look at all the figures, but the Government did not use the figures that we had provided. Either the Minister believes that my local authorities are giving her Department the wrong figures, or she thinks that we are inventing the shortfall, or she thinks that the authorities are paying too much to the bus operators. Those are the only possible explanations. Which does she think my local authorities are guilty of?

Rosie Winterton: The hon. Gentleman seems to have got into a bit of a muddle about the order in which the allocations were made. As I have said, when we consulted local authorities about the approach that they wished us to take, the formulae that I have set out proved the most popular. It is up to authorities to inform the Department of, for instance, visitor numbers or the amount of retail floor space. I should add that, according to the most recent annual figures available to us for Worthing's expenditure on concessionary fares, its special grant allocation for this year is 42 per cent. higher than the amount they said themselves was previously spent on concessionary fares.
	In our response to the Committee's report, we said that we would commission research on reimbursement arrangements to look at the latest evidence on the number of passengers generated by local and national schemes, the revenue forgone by bus operators and the additional costs. We also want to work closely with bus operators and local authorities to share the evidence. The research will explore the scope for more simplistic and deterministic ways of setting reimbursement, such as, perhaps, a table of payments for different regions and area types. But it is important to remember that, within this framework, local authorities have three-year settlements. We want to make sure that we do not disrupt agreements that have been reached, but we want to make sure that we are researching in the way that the Committee has suggested to look at potential suggestions from bus companies and authorities.

Norman Baker: I welcome the terms of the review that the right hon. Lady has set out. It is indeed sensible and good news but I am slightly worried by the three-year time scale. I understand that there is a three-year settlement for local government, to which she has referred, but I think she will accept that certain local authorities are, for whatever reason, deeply out of pocket as a consequence of the present arrangements. It seems unjust to make them wait a further couple of years before any recompense is available to them.

Rosie Winterton: At this stage, we are commissioning research to look at some of the issues. I reiterate: it is not easy to come up with brand new formulae that could in some circumstances upset arrangements reached with bus operators. There is an appeals process, which I will come to later.

Graham Stringer: I am doubly grateful to my right hon. Friend, first for giving way, and secondly for providing in a parliamentary answer the fact that, on the commercial network, the average subsidy per bus is £37,500 per year, comprising the bus service operator grant and concessionary fares. Is she worried that with that huge level of subsidy, bus operators are directing their operations more to how much public subsidy they can get rather than to the interests of the passenger?

Rosie Winterton: As my hon. Friend knows, there are some areas where it is clear that bus operators and local authorities are working closely together and are producing a good service for passengers. However, it is also true that does not happen in other areas, which is why we are making some of the changes in the Local Transport Bill and which, as I pointed out, the main Opposition party does not support.
	The hon. Member for Scarborough and Whitby asked about cross-border travel. There is nothing I can add to what I have said previously in the House, which is that we want the scheme to settle down in England before we look at what could be an immense financial commitment in extending it to Scotland and Wales. If the hon. Gentleman is committing his party to that, I suggest that he cost it very carefully and look at some of the technical issues that surround it. However, that does not prevent individual local authorities on the border coming to agreements with authorities on the other side.
	The hon. Gentleman also talked about funding. The Government are certain that a generous settlement was made; the increase in his local authority was 58 per cent. on what was spent previously on concessionary travel. He also asked whether the £4.50 grant would be repeated. We felt that it was right to pay local authorities for the initial issue of smartcards to make the changes. We covered the full cost of that issue but it is not unreasonable to ask local authorities to cover the cost of renewal.
	The hon. Member for Shrewsbury and Atcham (Daniel Kawczynski) is not in his place so I will not answer his points.
	The hon. Member for Lewes (Norman Baker) talked about putting smartcard readers on all buses. He raises an important point. We felt that it was important, given the change in terms of the national concessionary scheme, to say, "Let us have a system that can be interoperable." That is why we designed the ITSO smartcard approach. Readers are not yet available on all buses, but there are different ways of looking at that issue and it is important that we do so. The hon. Gentleman will know that we are looking at BSOG, the bus service operators grant, to see where there are incentives. Quality contracts and quality partnerships could well be ways to make it easier to introduce smartcards. He raises an important point, but if we had not got a system that could be smartcard-compliant everywhere, it would have been a missed opportunity. He also raised the issue of penalty fare appeals. In the response to the Select Committee, we said that we would look at the penalty fares rules of 2002.
	I think that I have addressed most of the points made by the hon. Member for East Worthing and Shoreham, particularly in terms of the increase in funds available. I am glad that he is campaigning for the pedestrian crossing that he has now decided is the answer to the problems. I am very glad that he is not asking me to install it.

Robert Goodwill: I asked the Minister about the number of appeals that bus companies had lodged, which is a way of measuring the level of dissatisfaction.

Rosie Winterton: Yes, the hon. Gentleman is absolutely right. Some 102 appeals were received in respect of travel concession schemes for the financial year 2007-08. Of these, 27 were subsequently withdrawn. A handful did not proceed owing to lack of data. Of the 71 appeal determinations, 33 were successful and 38 dismissed. They have been notified to the applicant bus operators and each relevant transport concession authority.
	This has been an interesting and constructive debate. I hope that my hon. Friend the Member for Liverpool, Riverside and other Committee members will feel that our response to the Committee's report was helpful. I certainly believe that it was extremely useful to discuss some aspects that, in the normal course of most debates, are not necessarily raised but that have enormous implications, particularly when we are trying to encourage more people to use public transport and examining how to improve our bus services. I congratulate the Committee on the report.
	 Question deferred, pursuant to paragraph (4) of Standing Order No. 54 (Consideration of estimates Etc.).

DEPARTMENT FOR INNOVATION, UNIVERSITIES AND SKILLS

Science Budget

[Relevant documents: T he Fourth Report from the Innovation, Universities, Science and Skills Committee, HC 215, on Science Budget Allocations, and the Government response, HC 639.]
	 Motion made, and Question proposed,
	That, for the year ending with 31st March 2009, for expenditure by the Department for Innovation, Universities and Skills—
	(1) further resources, not exceeding £11,040,399,000, be authorised for use as set out in HC 479,
	(2) a further sum, not exceeding £12,519,763,000, be granted to Her Majesty out of the Consolidated Fund to meet the costs as so set out, and
	(3) limits as so set out be set on appropriations in aid.— [Tony Cunningham.]

Phil Willis: I welcome the opportunity to debate the Innovation, Universities and Skills Committee report on the science budget allocations, and, on this estimates day, to have a debate on the departmental estimates and on budget issues. I am glad that a significant proportion of the Committee's members who were involved in the inquiry are present, and I hope that all of them will be called to speak before the end of the debate.
	This inquiry sits against a backdrop of significant investment in science and research, and it is worth putting on record the Committee's acknowledgement of, and support for, what the Government have done for science over three consecutive comprehensive spending reviews. The allocation for the current CSR to 2011 is an overall increase of 17.4 per cent. in the science and research budget—an increase of just over £3.5 billion.
	Inevitably, some research councils have had bigger increases than others, reflecting Government and societal priorities. The Medical Research Council received a 30.1 per cent. increase in funding and the Biotechnology and Biological Sciences Research Council had a 21.8 per cent. increase. That, in turn, reflects the increase in the volume of translational research that takes place in those councils. At the same time, other councils received different amounts. The Arts and Humanities Research Council received a 12.4 per cent. increase—its budget remained on a plateau—and the Science and Technology Facilities Council received 13.6 per cent. They received the smallest allocations.
	When the Committee started the inquiry, its intention was to take a short, sharp look at the science budget allocations for the 2007 CSR and then to move on. Immediately after announcing the inquiry, however, all members' mailbags were filled with correspondence from the particle physics and astronomy community. When the Secretary of State announced the budget allocations at Church house on 11 December, he and the Minister were taken aback by the fact that almost every question from the floor on that occasion came from members of that community. It soon became obvious that the allocation for the STFC was causing significant problems, so, although our report was about science budget allocations as a whole, it focused heavily on the STFC. Other Members will undoubtedly want to raise issues about specific elements of the STFC budget, but let me outline some of the key considerations.
	Inevitably, considering the controversy that surrounded the allocations to the STFC, there has been a fair amount of progress since the publication of our report, and it is important to put that on record. Both the Government and the STFC have responded, and last week the STFC made a number of welcome announcements on its future plans. This estimates day debate offers the Minister an opportunity to give further clarification on some of the still outstanding issues, and I hope he will take it.
	The Government accepted some of our recommendations, and we should be grateful for small mercies. For example, we recommended that the Government change the name of the science budget to the "science and research budget" to reflect the inclusion of the arts, humanities and knowledge transfer, and the fact that they accepted that major change needs to be shouted from the rooftops. We welcomed the Government's commitment to maintaining above-inflation increases for the science budget—now the science and research budget. We also welcomed the Government's commitment to innovation and knowledge transfer. I think that there is general agreement that it is right to turn world-leading basic research into health and wealth benefits for the country, and we compliment the Minister and the Government on that.

Bob Spink: The hon. Gentleman is beginning his speech on characteristically great form. Does he agree, however, that the name does not matter, and nor, in some ways, does the total amount that is expended? What matters is how that money is used, and not enough of it is used on blue-sky, innovative, high-risk research that will become translational and will deliver those results that are unexpected but are what we need to move things forward.

Phil Willis: I am grateful to the hon. Gentleman for that intervention. He was—or, rather, is—a distinguished member of our Committee; the problem is he never turns up.

Ian Gibson: The hon. Member for Castle Point (Bob Spink) is a party of one.

Phil Willis: I refuse to respond to such comments from a sedentary position. It is right to say that maintaining blue-sky research is crucial for this nation's future in terms of wealth and of health. All Committee members are conscious of the fact that we have to keep the Government's nose to the grindstone in producing the resources for basic research, and I think that this report does that. It is up to other parties to match that commitment—that might be a comment the Minister wanted to hear.
	To return to my speech, unfortunately we could draw few other positive conclusions from our investigations. Indeed, the way both the Government and the STFC handled the budget process was, to put it mildly, deeply flawed. Disappointingly, rather than engage with the criticisms, the Government have rejected almost all of the conclusions and recommendations that followed. I know that other Members will wish to return to them, but I want to focus initially on the STFC.
	The inquiry uncovered profound problems within the STFC—weaknesses in its senior management structure and leadership and in its peer review and consultation processes. To be fair to the STFC, however, it has taken some positive steps following our critique. In co-ordination with the Department for Innovation, Universities and Skills, it has commissioned an independent organisational review following our criticism of its senior management. We look forward to seeing the conclusions of the review and what positive changes will follow. The STFC also consulted extensively within its community prior to last week's publication of its "roots and branches" reprioritisation of the entire council programme.
	Broadly speaking, the views of the peer review panels and the funding decisions taken by the STFC are now closely aligned, and we must question why that was not the case in the first place, because it would have saved much anxiety within the community.

David Howarth: What has happened has been deeply damaging to the physics and astronomy community. Does my hon. Friend accept that some of the damage is long term? The community itself has now lost what confidence it had in the senior management of the STFC and it might only be regained by a radical reconstruction of its leadership.

Phil Willis: I hear what my hon. Friend says. It is the job of a Select Committee to examine carefully the evidence that is put before it, to make clear recommendations, and to expect both the Government and any organisation that is criticised to put matters to rights. A systematic review is taking place, agreed between the DIUS and the STFC's leadership and its chief executive. I am content to wait until that review has been completed and the Government have responded, so we can see whether the community—which has without doubt been damaged—can have its confidence restored. It is easy to call for people to resign: it is far more difficult to resolve the problems within an organisation. I hope that my hon. Friend will be content with that response.
	In addition to the review, the STFC has appointed a communications director from outside the organisation, which our report recommended. There were a number of areas of particular concern that were brought to our attention and which we highlighted in our report. The first concerned the future of the Daresbury laboratory. It appeared to us—and it was confirmed when we visited Daresbury—that the campus was being prepared as a technology business park rather than a world class science centre. Other hon. Members will wish to add their impressions of the visit, but we are encouraged that the STFC has announced that key research activities, such as ALICE— accelerators and lasers in combined experiments—and EMMA, or the electron model with many applications, will continue at Daresbury. Although the STFC has always said publicly that it is committed to Daresbury, the decisions to retain ALICE and EMMA, and the acknowledgement that it will take some time to rebuild the science capacity there, are welcome both in terms of Daresbury's future and as a vindication of the serious concerns that we raised in our report.
	The astronomy technology centre in Edinburgh was a second area of serious concern for the Committee. Here the future is less clear. The STFC wanted to close the centre, but has now opened negotiations with the university of Edinburgh to take it on. I hope that the Minister will be able to reassure the House that those negotiations have his blessing and are likely to come to fruition. I also hope that the Scottish Parliament is being encouraged to play a key part in ensuring that we retain that world class facility.
	I am pleased that our report has also led to other movement. For example, e-MERLIN—which will increase the sensitivity of the existing MERLIN radio telescopes by a factor of 30—is central to the future of an operational Jodrell Bank and, according to one of STFC's peer review panels,
	"is guaranteed to lead to major discoveries".
	One wonders therefore why it was under threat of having its grant removed. Fortunately, it will now receive some money from the STFC, but the STFC is looking for other partners to share the cost. The programmatic review announced last week resolved to find a way to bring other partners on board to ensure the medium-term future of the programme, but Jodrell Bank is interested in its long-term future, and I hope that the Minister will be able to make some comment about that.
	A fourth area of concern was solar-terrestrial physics, which appeared on the brink of extinction following the first round of STFC announcements. The only ground-based STP to receive continued support in the near term is the European Incoherent Scatter Scientific Association programme—EISCAT—which is an international research organisation operating three incoherent scatter radar systems in northern Scandinavia. It will receive that support only because the UK is legally bound to a multi-year contract.
	The STFC has declared that it will cease payments to EISCAT in 2011, but EISCAT membership is on a five-year rolling contract. It is now 2008, and it appears that we are tied in until at least 2013, not 2011. The STFC has decided that it wants to leave, but it has not even discussed this with the director of EISCAT or given any formal notice of withdrawal. It is that lack of communication and shoddy handling of key facts that has landed the STFC in real trouble over its future plans. Perhaps the Minister will clarify the position on EISCAT this evening.
	It is that same lack of communication that appears to be at the heart of the STFC's budget problems. Its inability to communicate properly with its own community will, I hope, be put right in the future. In redressing the balance, the STFC clearly has some difficult times ahead, but the fact that it has listened—albeit belatedly—not only to the Committee, but to its community, is a positive step. We welcome the STFC's willingness to address our criticisms constructively. The fact that it will spend almost £2 billion over the next three years on what is a hugely exciting programme is something that we should now support, instead of raking over old coals. Of course, there have been some losers in the funding round, but there have also been some big winners.
	Let me now turn to the ability of the Government and Minister to engage with what I always hope will be positive criticism from the Select Committee. The Minister will accept that many members of the Committee are deeply committed to science and do not make criticisms purely for the sake of it. The Government rejected the bulk of our conclusions and recommendations, and we acknowledge that they have every right to do so, but they do not have the right to traduce what the Committee said or to produce a response that was impolite, inaccurate and, at times, incomprehensible. That is unacceptable and should be challenged.
	The Government were hasty in rejecting our recommendations regarding the transparency of the allocations process, and in particular our suggestion that documents prepared for bilateral negotiations between the Government and the research councils should be published as a matter of course, which goes to the heart of the issue of transparency and communications with the community. The Government rejected the recommendations on two grounds. First, they claimed that some information is commercially confidential—I can understand that—and, secondly, that transparency would put at risk "candid discussion and robust appraisal" during the allocation process.
	The Minister must recognise that those are not sensible rebuttals. Commercial sensitivity did not prevent the release of most of the information under the Freedom of Information Act 2000 and, if that is an issue, DIUS should be able to release the documents as a matter of course, with steps taken to remove commercially confidential information prior to release. The second concern, that transparency would put candid discussion at risk, simply does not hold. We have not asked to see transcripts of the negotiations, because that would be preposterous, but we have asked for the documents relating to the negotiations so that we can see on what basis the decisions are being made.
	Keeping the negotiations confidential opens the Government up to accusations that they have inappropriately influenced the decisions that research councils take. That is the most damaging accusation for the relationship between the Government, the research councils and the research community. Accusations that the Government have broken the Haldane principle are already coming from organisations such as CaSE, the Campaign for Science and Engineering, and when such strong organisations make complaints, people sit up and listen, and so should the Government. They cannot simply dismiss those accusations. Will the Minister consider our recommendation that the documents that are prepared by research councils for use in bilaterals with DIUS are published as a matter of course?

Evan Harris: Does my hon. Friend agree that the Government's argument that this decision is part of the comprehensive spending review negotiations is different in this case? It is not like allocations to the Higher Education Funding Council, for example, where the Government rightly and transparently say that they want to direct Government priorities and to see that what the council proposes to spend in the settlement is what the Government want it to do. In this case, the Government claim, rightly or wrongly—rightly, in my view—that they do not have any influence on particular scientific programmes. Therefore that process of negotiation is especially different in Haldane.

Phil Willis: I am grateful to my hon. Friend, and I am sure that he will make those points again. That was the very point that I was trying to make—obviously, not as well as I should have.
	We welcome the fact that the CSR period will be characterised by an increased emphasis on translational research into health and wealth benefits. Three new bodies have been set up recently for that purpose: the Office for Strategic Co-ordination of Health Research, or OSCHR; the Energy Technologies Institute; and the Technology Strategy Board. It is clear from our report and the Government's response that those new bodies—welcome as they are—are partially supported by reallocated money that previously supported basic science, which I think was the point that the hon. Member for Castle Point (Bob Spink) alluded to earlier.
	The Government defend the movement of funds in paragraph 43 of their response by saying:
	"It is the role of Government to encourage the research base regularly to assess and adjust funding to take into account shifting priorities."
	They go on to say:
	"It would not be appropriate to adopt an approach that only funded new initiatives after all existing activity is maintained."
	Those statements run contrary to previous assurances that the Government have given to us that basic science will never be cut in favour of translation. Can the Minister reassure us that the increased emphasis on translational science will not have a detrimental effect on basic science—the kind of science that is not on the fast-track to translation, but will instead enhance humanity's knowledge base in the long-term?
	The key issue of the Government's approach to the Haldane principle emerged during our discussions on regional policy. I am sure my colleagues will speak later, so I shall be brief. In short, the Government appear hopelessly confused on regional policy. They have repeatedly stated that they want
	"to strengthen science investment at Daresbury".
	That desire has led the Government to have a specific vision for the STFC to fund science at Daresbury. Whether or not that is a breach of the Haldane principle, it is a clear breach of Government policy, which is:
	"Public funding of research at a national level, through the Research Councils and funding bodies, is dedicated to supporting excellent research, irrespective of its UK location."
	That is a direct quotation from the "Science and innovation investment framework, 2004-2014".
	Surely, if the Government follow their own guidelines and the Haldane principle, they should not be putting pressure on research councils to invest money in any specific location, as they have done by repeatedly voicing a desire to see world-class science facilities at Daresbury and by outlining their specific vision for the Daresbury campus to be a partnership between the STFC and others. That is for the research councils to decide on the basis of the science, but the Government are clearly and rightly determined that Daresbury should have a bright future.
	I understand that there is a problem for the Minister: either the Government have a regional science policy or they are reaching for one. Either way, they should make their position clear. Will the Minister reconsider our recommendation to open a debate on regional science policy by producing a White Paper on the subject? He cannot still simply allow the confusion to go on between centrally driven national policy, in terms of the Haldane principle and excellence, and regional policies.
	Finally, at the heart of the problems over the STFC's budget is the financial legacy that the STFC was left with following the merger of the Particle Physics and Astronomy Research Council, or PPARC, and the Council for the Central Laboratory of the Research Councils, or CCLRC. The Government have repeatedly denied that the origins of the STFC's budget shortfall have anything to do with an inherited deficit from CCLRC by pointing out that the STFC was formed without a budget deficit. That is absolutely true, and the Committee has no wish to reopen that argument. However, the Government have consistently missed the point. As Professor Keith Mason, the former chief executive of PPARC and current chief executive of the STFC, so correctly put it:
	"the base line budget allocation to the ex-CCLRC...was not fully raised to compensate for the running costs of Diamond and ISIS Target Station II".
	That was the point.
	Let us consider the facts. CCLRC would have had a budget deficit of approximately £80 million, in today's money, had it continued as a stand-alone council, because its baseline allocation was not sufficient to meet the running costs associated with Diamond and the ISIS second target station coming online. That is shown in the National Audit Office report, "Big Science", from January 2007—it is not something that we made up. The STFC was given approximately the combined budget of CCLRC and PPARC and the STFC's budgetary shortfall is almost exactly the same size as the amount that CCLRC would have been short of had it been able to continue as a stand-alone council. Those facts cannot be dismissed on the grounds that CCLRC should have planned its budgets more carefully on the basis of a flat cash settlement. That might be true, but it is unfair to saddle former PPARC users with a deficit derived from CCLRC. That is exactly what happened as a result of the budget settlement.
	The Government assured us that there would be no legacy issues associated with the merger. They got it wrong and they should take responsibility for that, rather than hiding behind other people's decisions. Although we know the outcome of the programmatic review, we still do not know what the grant allocations will look like. Will the Minister consider a modest STFC uplift to prevent significant grant cuts if Professor Bill Wakeham recommends that when he reports in the autumn?
	The process has been interesting and has raised some fundamental issues about the Haldane principles and the independence of the research councils. It has also raised some very interesting issues about how individual research councils work. At the end of the day, the major problems have not transpired to be as serious as was first thought. I am grateful for that. I hope that when the Minister replies he is able to give not only the community in the STFC but the whole research community the commitment that the Government will seriously consider the recommendations of the Committee, rethink some of them and bring forward new proposals.

Roberta Blackman-Woods: I, too, am glad to be able to participate in the debate. It is perhaps rare for Select Committee business and constituency business to collide in quite the way they did for me on the matter of science funding. Since becoming an MP, I have spent a considerable amount of time establishing a relationship with the science community in Durham. That community is reflected in our excellent world-class university, our science learning centre and Framwellgate school, which is to be rebuilt as a science village.
	I have also wholeheartedly supported the prominence that the Government have given to science, and the recognised and often cited need for us to maintain and enhance the science budget given the many years of Tory neglect. Indeed, the uplift in the budget was needed to keep us internationally competitive in an increasingly global economy.
	The 2007 comprehensive spending review was flagged up in advance as a very difficult spending round, and so it proved, but I am particularly glad that science funding was protected. As I think the hon. Member for Harrogate and Knaresborough (Mr. Willis) mentioned, science funding has doubled in real terms since 1997, having gone from £1.3 billion then to £3.4 billion in 2007-08. The CSR 2007 allocation made provision for a further rise of £4 billion between 2008 and 2011. That is an average increase of 2.7 per cent. a year in real terms over the next three years. I was consoled by the fact that, despite a difficult spending review, science appeared to be protected, and the Government were continuing to support world-class research and sought to drive up the economic benefit that could be derived from investing in science.
	As the Committee's report points out, the headline figure is a three-year increase in the science budget of 17.4 per cent. As I have said, that reflects a Government commitment to implement the main recommendations of the Cooksey review on health research funding and the Sainsbury review on the role that science and innovation can play in keeping the UK competitive. It is of course true that not all research councils will receive the same percentage of uplift in their budget. As was mentioned, the Medical Research Council will receive a 30 per cent. increase. Nevertheless, overall, even the Science and Technology Facilities Council budget had a planned increase of 13.6 per cent. I will talk a bit more about that percentage later.
	I therefore felt some consternation and confusion when I started to receive frantic telephone calls from members of the physics community in Durham about the dreadful cuts that would be inflicted on them after April. That appeared to relate to budget cuts that were to be introduced by the STFC and that would affect not only their projects, but programmes supporting students. Something seemed to be going dreadfully wrong, and I had already made up my mind that the matter needed investigation, but news of the impending disastrous cuts had also reached the Science and Technology Committee, and it took the view that we should look into the STFC issues as part of the wider inquiry on science budget allocations.
	As I am sure that other hon. Members will point out, the inquiry threw up a number of worrying conclusions about the conduct of senior staff at the STFC, the difficulties with the prioritisation process for key awards, the clarity and transparency in decision making, and the issue of whether the whole fiasco and the concern over funding could have been avoided if there had been a slightly better settlement for STFC when it was established and took over from the Council for the Central Laboratory of the Research Councils and the Particle Physics and Astronomy Research Council.
	Despite the depth of the inquiry, we still have not got to the bottom of the extent to which the issue arose from the initial funding problems of STFC, as the Government response was inadequate in that respect. They simply refute allegations made by the Committee, instead of establishing detailed evidence about the funding of CCLRC and PPARC when they were disbanded, and when STFC took over from them. Paragraph 39 of the Committee's report makes that very clear and asks the Government to look into the legacy issues in detail. However, all that the Government do in their response is make it clear that they provided an extra £185 million in excess of the flat cash settlement over the CSR period. We all know that that additional money, welcome though it was, was to fund specific projects and priorities that had already been planned. There is a lack of detail, and I hope and suspect that the Committee will return to the issue, as we need to get to the bottom of the funding allocation and the extent to which it meant that significant programmes would have to be cut.
	In the Government response, there is a lack of recognition of what it will mean for the STFC when the full economic costs come on board; that will, of course, reduce the distance that research grants can cover. When Professor Mason, the chief executive of the STFC, first appeared before the Committee, it seemed to me that the funding had not been received for all the STFC's commitments. That problem was compounded by a prioritisation of the programmes identified by the STFC; in particular, new areas for growth had been identified. That prioritisation, with subsequent cuts to other parts of the STFC, was the root of the problem and appeared significantly to upset the science community. I know that from my experience in Durham, from a lot of the evidence that the Committee received in its visits, and from witnesses who came before it. The new prioritisation programmes seemed to come from absolutely nowhere, and there had been no real consultation with those likely to be affected.
	The relationship between the STFC management and at least one key sector of the physics community seemed very weak, and led to a lot of distrust on the part of the academics involved. In particular, there was a view that disproportionate cuts were being made to particle physics. Conclusion 10, which relates to paragraph 46 of the report, summarises that well:
	"We welcome STFC's decision to support its major facilities to the extent set out in its Delivery Plan...However, we are concerned that the decision to support the large facilities has come at the expense of research in fields where the UK excels".
	Two examples are given: the international linear collider and the Gemini telescopes. Scientists in Durham and elsewhere who are involved in ILC-related work maintain that they were not consulted at all about the STFC decision, and it is the lack of transparency and the poor peer review in setting the priorities for the STFC that the Committee wishes to investigate. Of course, the issue has to some extent been overtaken by last week's report from the STFC on the new priorities. Nevertheless, that was a key issue that the Committee investigated, and some of the Government response was perhaps a little weak.
	It was apparent that many people did not think that the peer review panel, which was set up to inform the delivery plan, was fully representative of the appropriate scientific community. Confidence in peer review is essential if decisions by research councils are to be seen as legitimate by the relevant academic community. I hope that the STFC has learned from its actions and will do as it has promised and bring on board all members of the academic community who are involved in ensuring that that community has a greater say in the decisions taken.
	It is clear from the Government's response to the report that peer review is not considered a matter for the Government to get involved in directly because of the Haldane principles. I think that we would all agree that it is not appropriate for the Government to get involved in the day-to-day operation of research councils, or even in prioritisation, but it would have been appropriate for the Government to state that the efficacy of the peer review system and processes at the STFC could be improved in the light of the very heavy criticism that we unearthed.

John Hayes: On the Haldane principle and conclusion 6 of the report, the hon. Lady will be mindful of the fact that the Committee argued that cross-cutting programmes that affect more than one council, largely in pursuit of Government-inspired initiatives, have skewed budgets. Does she agree with that conclusion? I know that she is attempting to be very measured, but is that an issue that the Government should look into further?

Roberta Blackman-Woods: The key issue is transparency. I think that we would all accept that the Government may wish to put more of the budget into one area than another, and I hope that we all feel, across the House, that that is a perfectly legitimate thing for them to do. That may mean that they point research councils in directions that mean pulling their budgets. We have seen that happen with regard to health research. The Committee was not convinced that the Haldane principles had been breached; we merely asked questions to get greater clarity from Government to ensure that the Haldane principles would not be interfered with.
	The response from the STFC grudgingly acknowledges in paragraph 86 that more needs to be done in terms of achieving effective consultation across its programmes. We have since seen some evidence that that may be the case. However, it is also the case that unless the STFC makes strenuous efforts fully to involve all parts of the community in its decisions, it will not be possible in the short term, or even the medium term, completely to restore the faith of the relevant academic communities in its ability to represent their interests.
	The next matter that I want to consider is international reputation. Many of the scientists to whom we spoke were very concerned about the damage that the whole episode was doing to the UK's reputation for science investment and commitment to international projects. There was strong concern that the actions taken by the STFC, and the way in which they were taken, would have a detrimental effect on our reputation overseas. It is not enough for the Government to assert, as they do in paragraph 93 of their response, that the UK remains a reliable partner. A reputation for being a reliable partner has to be built up over time, and people will judge the Government by their actions and by the amount of money that is given to the science community to enable it to support those international collaborations. I hope that I am making a helpful suggestion to the Government by saying that lessons need to be learned from what happened in this instance. It is important for them to emphasise that they will support and prioritise our international collaborations. They need to go beyond the stage outlined in their response to think about how they are going to address those criticisms and build up confidence again. It is not good enough to assert merely that our reputation is intact—the academic community needs more support than that.
	My last point relates to the lack of confidence in some parts of our science community about how secure its future is. That was perhaps the worst thing to emerge from this unhappy affair. In April, I met a group of a undergraduate students, postgraduate students and post-doctoral research fellows in Durham. A few hundred people attended the meeting—students from across the field of particle physics and the wider physics community. They were angry about the STFC decisions but, more than anything, concerned about their future careers. The Government should not underestimate how this set of cuts coming from nowhere without adequate explanation affected the confidence of those students. I find that especially galling given that the Government had done so much to support and raise the profile of science. I would have thought that they must at least see the STFC's actions as a PR disaster. It was most unfortunate that neither the Government's response nor that of the STFC acknowledged the damage that has been done to the trust of students and the academic community in general, and more needs to be done to bring that back into being.
	Of course, I did my best to assure the students that there was an ongoing commitment to them, to the work that they were doing, and to the particle physics community in general. They have international, globally portable skills, and it is important that the Government make it clear as soon as possible that they will continue to invest in science so that those students can go abroad for international collaboration as necessary but return to have a good career in the UK as well.
	Having talked to people in the community since, I know that they are glad that the STFC has softened some of its responses, including on the funding of the international linear collider. I think that that was a direct reaction to the Committee's report and to the protests made by the science community. Clearly, more attention will be paid to the STFC's decision-making processes and communications with its own scientific community and the world at large. People particularly welcome the commitment that no changes to rolling grants will be made before the Wakeham review has reported. I am grateful, as are they, that my right hon. Friend the Secretary of State for Innovation, Universities and Skills has instigated that review; we all hope that it will enable us to draw a line under the whole process. I hope that lessons have been learned and that Wakeham will be a clear report that sets the way forward for the whole field of physics based on the judgment of the scientists involved and that reflects the Government's commitment to science funding in future. I also hope that the new programme that has been outlined by the STFC means that we will all be able to move forward knowing that the future of science is to be fully supported by this Government.

Ian Taylor: I draw attention to my entry in the Register of Members' Interests as a non-executive director of a satellite company. I make that declaration because space comes into the budget of the Science and Technology Facilities Council.
	I am happy to piggy-back on the report and excellent work done by the Innovation, Universities, Science and Skills Committee. It is an important Committee, and I am glad that it was rescued following the Government's lamentable failure to keep the word "science" in any departmental name. Fortunately, the House of Commons did not allow it to disappear, and I played my part in trying to ensure that that was the case.
	This debate has been largely dominated by the STFC, which is better known as Swindon Town football club by those who are most active in it. It was a big failure by the Government not to anticipate what the implications of this would be. I happened to be giving a speech at the Rutherford Appleton laboratory at the beginning of December, immediately after Keith Mason made his speech at the same conference. I was able to stir things up a little bit because I had been warned by the science community that the STFC's move to change the budget balance was not very popular, because it had left the gap that the Committee subsequently investigated. Rather than go over that ground again, I would like the Minister to give us some indication of the impact of the £1.9 billion settlement that the STFC announced a few days ago, and to outline whether it largely solves the problems that were previously discussed. That announcement happened only recently, and it is difficult to evaluate its implications. I am glad, however, that there has been a settlement.
	When I was Minister, a very long time ago, we always had problems with big physics, not least because of the contributions to organisations such as CERN, which often skewed budgets in quite an alarming way. However, CERN deserves a mention today. In 1994, I was involved with the beginnings of the project now known as the large hadron collider, and we are about to see the culmination of that project after a long time—a 14-year gap. It is a hugely important project. For the record, I would like to compliment the  Financial Times, which, in its colour supplement at the weekend, produced an excellent article by Clive Cookson on CERN and the large hadron collider, including some useful glossaries of the terms that sometimes make it difficult to explain why CERN is important.
	The studies of fundamental particles and forces that make up the universe are, perhaps, about to be unlocked, and we could reach a sudden understanding of the Higgs boson and all the other excitements that scientists have pondered for a long time, which would justify the British Government's contribution to CERN over the years. I know it has sometimes been controversial because of its unbalancing of budgets and the difficulties of ensuring that other parts of physics and astronomy got their fair share.

Bob Spink: Does the hon. Gentleman agree that it may be even more exciting and useful for the scientific community if the existence of the Higgs boson were not confirmed?

Ian Taylor: It might well be—that is a fair point—but let us find out what happens when this thing is switched on. The construction of it is the most remarkable engineering triumph. I went to see the earlier establishment at CERN, but I have not seen the current edifice, only photographs of it.

Ian Stewart: Does the hon. Gentleman agree that it was the foresight of successive British Governments that brought the partnership for CERN together? Indeed, it is fair to say that no Governments in the world could afford to do such a thing now. Do not those British Governments, and Britain, deserve a pat on the back for the things that have come out of CERN, such as the world wide web? They could only have been brought about with the support of the British Government.

Ian Taylor: The hon. Gentleman, with whom I have enjoyed several investigative trips to various scientific and telecommunications establishments, has put his finger on it. I am grateful to him for saying "Governments", because there are times when I think that the Labour party believes that the world started in 1997. Actually, it did not. The project that has now come to fruition goes back a long way and has been supported, sometimes with considerable difficulty, by protecting the CERN budget from those who wished the funds had been allocated elsewhere.
	The hon. Member for City of Durham (Dr. Blackman-Woods), whose constituency has a very fine university, was a bit churlish, which was worrying. I would not have picked up a party political point of view in what she said were it not for one thing. It is of course correct to say that the science budget has doubled through the money that goes to the research councils, and I have paid warm tribute to my main successor, Lord Sainsbury of Turville, for the work that he did in ensuring that that was the case. I put that on the record with no caveats attached. I welcome it; I only wish I had had the ability to persuade my Chancellor of Exchequer that we should do the same thing. It was not for want of trying, but I clearly did not have the powers of persuasion that Lord Sainsbury had when it came to money. Nevertheless, it is of extreme concern that the percentage of gross domestic product spent on R and D by the Government has not increased since I left office in 1997. I wish that the hon. Member for City of Durham had made that point in her balanced speech because it is a matter of great concern to many people, not least those in industry who work closely with other Departments.
	Obviously, the Ministry of Defence research budget has declined. I remember working with the then chief scientific adviser to the Government, Lord May, who is now playing an important role in the other place with regard to science. He wrote a paper, which I requested, on the significance of the decline in the defence research budget. Sadly, although the paper was very influential, it did not prevent the curtailment of that departmental research. That has had a big effect on many of the value added companies that this country requires, and I hope that the Minister will take it into account when he talks about the Government's record. We have to put it in that context.
	Other international comparisons are of concern. We always talk about the way this country does well in citations, and I do not dispute that. Nevertheless, we can see the rate of growth of research and citations in other countries. Unsurprisingly, I suppose, China shows a particular growth in citations in mathematics, engineering and the physical sciences. For the record, and the ease of those who wish to find it, the previous figure about GDP was taken from page 34 of the Sainsbury review, which was published in October 2007. The point about the worrying tendencies in citations is on page 36. The British Government's proud record on citations is rather retrospective, and we have to be careful about other countries racing to the top.
	It is important to note that page 35 of the same report shows that the amount of research conducted by the British Government in the public sector is still lagging behind that of many of our competitors. It is certainly not something that we should boast about too much. In this country, the private sector does almost twice as much, in terms of percentage of GDP, as the Government. There are worrying concerns if one looks at the Government as a whole, and the impact on science.
	My report, which was a submission to the shadow Cabinet on science policy, indicated that we should look at whether further mergers should take place in the research councils. There is quite an unproductive hierarchy among the remaining research councils, which is duplicatory. The Minister's duty, while preserving the Haldane principles, as I had to try to do when I was Minister, is to give guidance on the linking themes and cross-disciplinary research that the research councils should bear in mind. I know that that is happening, but I am still rather worried about the process.
	I have talked to most of the people involved in the research councils during the past 18 months while conducting my research, and we have to be a bit careful about just saying that peer review is wonderful. It would be useful for the Minister to start a proper inquiry into whether peer review is quite what it is cracked up to be in what is increasingly becoming a multidisciplinary age. I do not get such feedback from many of the scientists involved, so perhaps it is a worthy study for the Select Committee.

Phil Willis: Indeed, successive Select Committees have pondered exactly that question. The hon. Gentleman will know that when broad-based metrics were suggested as an alternative to peer review, nobody could agree about what should be in the metrics, so we went back to peer review.

Ian Taylor: I agree that it is a conundrum. Given that Select Committees are collectively much brighter than me, I am sure that if the Select Committee is still worrying about how to conduct a review, that proves the complexity of the matter. I still think that it is important, though, largely because science in this country, even basic science, needs to be increasingly cross-disciplinary. I am not sure whether the systems that deliver research grants are helping that process. University vice-chancellors talk avidly about it, but if they do not think that they will get a five-star department out of it, they are not so keen. The challenge is to perform well at multidisciplinary level. I am goading the Minister, really, rather than criticising him. He is relatively new in the job and has made a very good start, if I may say so, but I would certainly want to get my teeth into that matter if I were lucky enough to be in his position again.
	That brings me to a point on which we must be careful about our thinking. Of course basic science is absolutely essential—I have no problem in saying that. However, we have a habit in this country of giving a status to basic scientists that we do not give to applied scientists, and certainly not to the category known as engineers. That is a national weakness. The trouble with my saying that is that people will take it out of context and say, "Well, the former Minister was really trying to say that we should downgrade basic science." That is not what I am saying at all. We should raise the status of other scientists to that of basic scientists.
	The whole process pushes basic science into coming up with "the idea", or an emergent idea. It may not be the one that was predicted—that is the whole joy of basic scientific research. However, the point of discovery has become the point of publication, and vice-chancellors admit to me that it is often the point at which they say, "Right, go back and do some new work so that we can get a five-star department next time." Whether the research be at Durham, Cambridge, Oxford or Imperial college, it hangs in the air somewhat, even though in many cases it could connect with that of other scientists. Increasingly, discoveries need to be exposed to those in other environments and disciplines so that we can capture their full benefit. That is a gap in our current work.
	Certain changes have been made, and I welcome them. The Technology Strategy Board is examining some of the work that is being done, and I have spoken to it. It has been put at arm's length, which is a good development. I am not criticising it, but I would go further. My report suggested an innovative projects agency, which would have a budget of £1 billion. Before our Front-Bench spokesman starts jumping up and down, I should say that that would not be new money. It would be a combination of what I regard as the far too diffuse Government expenditure on R and D, the post-discovery basic science process. The agency's budget would therefore be three to four times that of the TSB.
	I shall give the Minister a piece of advice. He might not like it, but the great joy of being a Back Bencher in opposition is giving advice freely. The regional development agencies are a nightmare, and he should pay rigorous attention to them. Frankly, he should throttle their scientific expenditure. Time after time I have heard academics and others say, "Oh, the RDA!" Most RDAs are risk-averse and do not have a proper idea of what they want to do. They love the concept of nanotechnology without having the remotest idea of what it is or what it involves.
	One vice-chancellor said to me that he had spent a year trying to persuade his local RDA—I shall not name it—to involve itself in a very exciting project. In the end, he used his own university funds and found some other way of covering the funding gap because the RDA spent the whole year saying, "It's a wonderful project, but we're not quite sure." The Minister should get the money back from the RDAs and give it to the TSB. In a way, he would be doing what we have said we will do if and when we come back into power. My hon. Friend the Member for Windsor (Adam Afriyie) might criticise me for publicising an idea that I have given him, but in the national interest we must make much more effort to focus what we do. My report makes many other suggestions, but it is available on the web, so I shall not bother to go into them now.
	The challenge that we face is getting more and more extreme. We have to show the people whom we want to attract to this country that we are doing exciting research. We need to attract and retain PhD research students. A considerable percentage of our current PhD students are from abroad, and we need to keep them here rather than allow them to go elsewhere. We need to work much more closely with industry, because a lot of the really challenging research beyond the basic is done in industry laboratories. The interconnection between those laboratories and universities is critical.
	To pick up on something in the Select Committee report, we must be a little careful about full economic costing. It is an extremely good guide to a university about its cost base, and if the FEC outcome is too high, the university knows that it has its internal overheads wrong. However, if FEC becomes a sort of bible that cannot be varied, many of the companies that want to work with universities will shift their contracts abroad. I could give chapter and verse of what has actually happened in several cases in which universities have said, "Well, this is the FEC of our postgrad. It is £100,000 a year, and like it or lump it." That is not the way to stimulate research. Many big companies now have research centres around the world and will concentrate on the areas where they think there is both individual, human expertise and a climate for research and development.

Ian Gibson: rose—

Ian Taylor: Of course I give way to the hon. Gentleman, who is my very honourable friend.

Ian Gibson: I thank the hon. Gentleman. Does he agree that much research in this country is paid for by charities and voluntary groups? They suffer under the VAT regime, which must be examined. We welcome their money for cancer research, for example, but they have to spend astronomical amounts on VAT on buildings and on renting space in universities, because ground space now has to be paid for per foot. That saps a lot of the well gotten money that the public give.

Ian Taylor: I judged my willingness to give way well, because that is an extremely powerful point and I shall do no more than simply endorse it. It shows that our universities and the Government need to be flexible in how VAT is applied.
	We are in a very competitive situation. Our historic strengths in science, technology and engineering are still there to be admired, but the challenge will be greater in the next few years. The outpourings from universities in India and China are getting greater, and more importantly those universities are getting shrewder. The Indians have gone well beyond just being a nation to which we outsource. There is now creativity in those countries.
	In my report, I cited the chief executive of Novartis in China. The company had put £100 million into a new research centre in Shanghai, and I said to him, "But surely there is not yet the depth and understanding of research in Shanghai to justify that." He said that I had missed the point, which was that a lot of the Chinese diaspora that had spread to America was beginning to come back, at least for part of the year, and the company wanted to be there to capture it. These are exciting times for Chinese universities, and we must ensure that they are exciting times for our leading British universities as well. That implies an even more radical look at how we fund research and how we tie basic research to capturing the innovation that is possible in our society in a competitive world.
	So two cheers for the Government, and credit to them for the money that has been spent on the science base, but I add the caveat that they could be doing something much more radical. Given that they might have only another 18 months, they should get on with it.

Ian Gibson: I am grateful for the opportunity to follow the hon. Member for Esher and Walton (Mr. Taylor) and to accept his invitation to be radical. We have heard some criticisms of the STFC, but many other aspects of the science budget need to be tackled in the debate. I do not get heavily stimulated by talking about budgets—I find it rather boring. Having run a department, in which I had a few million pounds to budget, I was quite creative, but I think that I got out just in time.
	Scrutinising the research councils is very much part of a Select Committee's work. It takes me back to the time when we scrutinised the Medical Research Council, which is now extolled for its work. However, I remember that our Committee's report was much more vehement than the report about the STFC. It created a hum in the community, but in the case of both research councils, the hum came from the grass roots. Those who are conducting the research and doing the work feel that something is not right. They suddenly find a way through the parliamentary scrutiny system to get to a Department with which they find it difficult to engage. It is not always the fault of Departments or Select Committees that we have not picked up on the problem. Scientists are not great communicators in the political process and we must tackle the issue of getting our young people who are coming through the system to realise where the money comes from. I hold my hand up and admit that too many scientists and technologists believe that the world owes them a living and that, if they come up with a smart idea, it will immediately be funded. Things have never been like that and, in my opinion, never should be. One has to make the case, justify what one is doing and show what benefit it gives the world, whether it is blue-skies research or research into a product.
	I left research partly because we were having to get rid of people, and employ people on one-year, six-month and one-month contracts in awful laboratories. It was therefore inspiring to hear in the Chamber in 1998 that Government money, alongside Wellcome Trust money, was being invested in refurbishing laboratories, which were dripping with damp. Every university now has a good laboratory. I believe that that has stimulated many young people to come into research—perhaps not enough, but at least something has started to happen.
	I introduced a ten-minute Bill, which I discussed with Lord Sainsbury, and said that we must double the science budget. Blow me, we doubled it—I should have asked for it to have been quadrupled. I made a dreadful mistake. I remember the conservatism among the scientific community, which thought that the measure was only a crazy ten-minute Bill. We knew that things could change and they did. That continues and we need further resources, as we have heard all evening.
	Much of the science around us has resulted in great health benefits to people in this country. My speciality is cancer, but I am interested in health generally. The bucket loads of money that we have given to cancer were driven by the research knowledge that emanated from scientists and medics in this country as well as in the United States. The discovery of oncogenes stimulated a field of cancer research, on which the Government picked up. They doubled the budget for research and treatment. We now have cancer plan 2, and we have realised that there is a journey to take on palliative care, on which there is further research to be done and clinical trials to undertake. The trials must not take place abroad—we should carry them out on our patients here because patients in a clinical trial generally do better and we get more information. We need more nurses to help get patients into clinical trials and so on. That is beginning to happen. Under the aegis of the cancer tsar, Mike Richards, there is great drive. Science, medicine and evidence underwrite all that continuing work.
	Today, there was a meeting in this place for ethnic minority groups from different communities, mainly in London. It has been realised that the cancer rates in different sub-populations—major populations in parts of the country—are different. Ten years ago, none of us realised that that was a problem. Now that we do, medical understanding is excellent. Women with breast cancers from Indian communities in the east end of London have a different culture and different problems in entering the national health service. We suddenly woke up to that and we are doing something about it.
	New procedures emerged from the Darzi report last week for the National Institute for Health and Clinical Excellence to make drugs and technologies available throughout the country. Primary care trusts now have to justify why somebody is not an exceptional case. If there is an exceptional case, everybody in the country who is in the same category must get the exceptional treatment. That is a major step forward, which I hope will get rid of the postcode lottery. We are therefore learning.
	Sometimes there is a lack of political drive in this country and from the Government to make things happen even faster. For example, we often cut research. I am especially interested in honey bees. Hon. Members may not be excited about that, but honey bee research has suddenly captured the imagination. A friend of mine said that it was the only subject discussed in a general committee meeting of the Labour party on the Isle of Arran. I understand that there are problems in Scotland, but honey bee research is an amazing field. Yet what do we do in this country? We sack the people who are conducting the research at Rothamsted. What did we do about BSE? We cut the research into BSE just before it happened. The previous Government cut the money for wave energy research, but now it is a fashionable subject for research, which provides great stimulation and experience. We were good at cutting money for research. We had an amateur approach of saying, "Well it's not very important at the minute, so we'll cut the research." That has gone.
	We must do more on dementia and Alzheimer's, as well as myalgic encephalomyelitis. Rare cancers—pancreatic, liver and kidney—do not get the same services as breast cancer and so on. There is therefore a good reason for believing that we have a big research future that will need much more money.
	It has also been said that commercial influence has been brought to bear on research in our universities and institutions. Research from this country and the United States led to the internet. Basic research led to it and its exploitation. There would be no silicon valley in California without that basic research. I could cite case after case—for example, DNA, a small short note in nature, which revolutionised the world. We should protect that basic understanding.
	Research councils need to be examined, and Select Committees should scrutinise them. They also need to think about how they can join together. For example, I know people who worked on atmospheric chemistry in three different departments, but they never spoke to each other. The previous speaker mentioned the fact that we have to get people in cross-cutting areas. The people who drink coffee together work together; the people who drink together get things done. That is my motto. People must work and discuss their problems with each other over the odd pint or half pint, depending on one's taste.
	Some research councils also have too many establishment figures making the noises. It is easy for that to happen in Britain. What is wrong with having good graduate students or members of the public on those councils, to listen and talk about the issues? I think I know why. When we put the public on to certain committees, such as on genetic modification, and when we had those juries, they have embarrassed a lot of the scientists by asking, for instance, "What does that mean?", "How does that happen?" and so on. The public ask for the basic information, which is very important in science. Research councils have a heck of a lot to learn.
	Last Monday, we discussed food scarcity in this place and we talked about plant genetics, or at least I did. The development of different breeding programmes—not necessarily genetically modified, but different programmes, involving different types of wheat and maize, for example—could lead to plants that can withstand drought and live in inclement parts of the world. Plant genetics gets a rum deal in this country, in terms of medical science and medical experiments.

Tim Boswell: It is a little known fact that at the age of 12, I aspired to being a plant breeder, but I never got there. The hon. Gentleman is making a characteristically trenchant speech. Does he agree that one important aspect is not merely the cross-cutting of different departments, but the ability to maintain certain national capacities in order to take a strategic view and move things forward? Where one is simply decentralising to the research councils and looking at peer review and so forth, the difficulty is that when we need a lever to pull, we suddenly find that we have no one left to pull it.

Ian Gibson: I thank the hon. Gentleman, who makes the point that I was about to make. For example, we have the edge in stem cell research, although one would not know that from listening to those who talk about science. If somebody made a big breakthrough in that field, for instance at Imperial, Dundee university or wherever else—the research is going on all over the place—where would it be exploited? I would guess that such a breakthrough might end up in California or somewhere else. The people there, or in India, China and so on, would know exactly how to take it into development. We must learn not just how to compete and how to beat those countries, but how to work together. After all, their students come over here, are very friendly towards us and then they go back, so there can be interchange.

Ian Taylor: The hon. Gentleman is being generous in giving way. The lesson that the Roslin institute learned from the cloning of Dolly the sheep was quite instructive. PPL Therapeutics, the company involved, subsequently moved to the United States. Many people in the science community in the United States simply could not believe what we had managed to do and were determined to get hold of the technology as quickly as possible. We are in a very competitive global market.

Ian Gibson: Yes, it is a competitive market, but who makes the competition? I do not feel that scientists—at least not the ones I know—have ever been competing with each other. We compete with each other over who gets their paper in  Nature or in the journal of this or that institute. However, the quality of the paper that someone publishes is important, too, and not just to their kudos, but to the world in general, because it is more read.
	One point that the hon. Gentleman did not make is that papers now do not have just one or two names on them. All the best papers have about 20, 30 or 40 names on them of people who have interacted in different ways in that subject—one can look in  Nature to see that. There are very few lone wolves these days. We have moved on from the days of the magic amateur monk who discovered breeding problems in peas. Science is big now and it needs money. We no longer have rich Darwins who can sail round the world, make wonderful observations in that amateurish way and take a long time to publish their work. Things are not like that anymore. After all, Darwin published only because Alfred Russel Wallace was breathing down his neck and was going to publish anyway, so he had to beat him to the punch. The world is different now, but there is still a bit of amateurishness in our science. We tend to think that we are very clever, but competition and, even more so, co-operation are very important.
	Let me finish by saying something about the regional development agencies, of which there has been some criticism. The ones of which I have experience—in the north-west and north-east—are magic. The way they have interacted with the universities and the community is great. The situation is very different in the east of England, where we have had our moment in the sun. I wanted to make Norwich into a science city, which would not cost a penny—indeed, that is mentioned in the report that the hon. Member for Harrogate and Knaresborough (Mr. Willis) talked about.
	There is a cluster of really good centres of excellence around Norwich. It is the same in Dundee, Oxford, Cambridge, Manchester and Durham. We can go all round the country and see places known as science cities. Some people think that "science city" is just something that is put up on a sign at the entrance to a city, but it is not. It is a concept involving people working together in industry and science, and in centres in which young people learn about science. It also involves schools that are scientifically erudite in the sense that they have special status. There are schools that specialise in engineering, for example.
	In the Select Committee on which I serve, I remember asking a representative of the Royal Academy how many special schools did engineering. The answer was, "I don't know." I would have thought that that would be one of the first things that a member of the Royal Academy would want to know. Surely they would want to know whether there were enough schools of that kind and whether we were encouraging enough young people to go into that field. Surely they should be asking what the Royal Academy should be doing to make that happen.
	We need the science city concept, and regional development agencies that do not just play the game of co-operating but actually do so. We must also ensure that we do not have any more instances of science centres closing. There are 20 per cent. cuts being made in Glasgow, for example, by a nationalist party that works on the basis of its supreme excellence in everything—because things happen differently in Scotland—yet it is closing science centres. We have a real battle on our hands right across the board. I believe that the science budget should have been quadrupled and, by gosh, as long as some of us are still breathing, it will be.

Bob Spink: It is a real pleasure to follow the hon. Member for Norwich, North (Dr. Gibson). As always, he has made a vigorous and superbly informed contribution. He has redefined the term "wide-ranging" tonight, speaking on everything from honey bees to stem cell research. I shall try to top that by slipping in something about nuclear fusion, which he missed out. However, he has forgotten more about science than most of us ever knew, apart from one or two honourable exceptions in the Chamber tonight.
	It is easiest, and most usual, to sanction certain sanitised and unexciting research and science projects, particularly in translational research, where outcomes are predictable. Of course that is important, but it must not be done at the expense of basic science and true discovery processes. Only by taking real risks will we push forward the frontiers of knowledge for the ultimate benefit of mankind, to help us eventually to save the planet. However, the universities and funding councils have become risk averse from years of battering by the sensationalist media and from interfering politicians, although there is none of those in the Chamber tonight. They have also come under pressure from commercial organisations, which are skewing their decisions on research projects. That is why I want to speak briefly tonight in favour of basic science and research, which, by definition, involves great risk, uncertainty and unexpected outcomes.
	The system of peer review, which has already been mentioned, has been examined by the Select Committee on a number of occasions. It has serious weaknesses, in that it fails to reject mediocre and poor research projects, and favours predictable journeyman-type work that is unlikely to deliver spectacular results or push forward the boundaries of our understanding for the benefit of mankind. Peer review acts as a gatekeeper at the start and the end of the research process. At the start, it determines which projects will get funding to go ahead in the first place. At the end, it determines which ones will get published in which academic peer review journals, which is important to the whole process and to spreading that knowledge.
	Peer review is instrumental in the whole project selection process, and it is therefore of great importance. However, it tends to back the safer bets and to reject the more imaginative, ambitious and, some might say, off-the-wall projects—the kind that the hon. Member for Norwich, North and I enjoy. But at the very worst, those projects will excite, encourage and inspire future generations of scientists, and who knows what might flow from them in the future? Such projects also enable us to encourage doctoral researchers to this country and to keep them here. They add so much to the UK's research base, and we need to continue to do that.

Ian Gibson: Part of the science budget is for PhD students and for post-doctoral fellows. Does the hon. Gentleman think that enough is spent on them, too much, or what?

Bob Spink: I do not think that enough is spent on them. We need to support more doctoral researchers in our universities—particularly UK-bred doctoral researchers, because they will mature, become the wealth generators and knowledge creators of the future and help to push forward medical science, which the hon. Gentleman is so concerned about. That is why I back the fund from the Royal Society, Britain's national academy of sciences, for the blue-skies research that gets around the peer review constraints to some extent.
	We must continue the red-blooded backing of big science projects such as Diamond, the Particle Physics and Astronomy Research Council, and the large hadron collider at CERN, which is extremely exciting. As I said in an intervention earlier, it may deliver even more for mankind if it disproves the existence of the Higgs boson rather than proves it, but we will see about that over the next few exciting months. On nuclear fusion, if we ever get Q factors up to the 35 or 40 level, we will take the greatest step ever in mankind's history—by saving the planet and moving forward.
	I hope that the Minister will give comfort to the House by saying that he and the Government are truly sold on supporting big science, and on continuing to do what they have done—magnificently—over the past 10 years with science, which is to put their money where their mouth is. I back the call of the hon. Member for Norwich, North for the science budget to be quadrupled and for a significant proportion of it to go to blue-skies research.

Graham Stringer: Several Members have mentioned that the amount of money available for science has doubled over the lifetime of this Government, so one would have thought that that would have led to a happy response—certainly from my constituents. In actual fact, after the last review, I received for the first time ever some very angry correspondence from my constituents. They were neither scientists nor specialists; they were just extremely annoyed at the news that Jodrell Bank would probably close. It was an extraordinary result for a Government who have shown their commitment to science by doubling the budget, and the report under discussion examines some of the background to, and the reasons why, it came about.
	I should like to discuss the issue by trying to answer three questions that are pertinent to Jodrell Bank. I hope that at the end of the debate, my hon. Friend the Minister will tell the House the latest news on e-MERLIN and Jodrell Bank, because although there have been stories with a positive spin in the press, it is not yet clear, as far as I can ascertain, whether Jodrell Bank's future is secure, so I should be very grateful if the Minister updated us.
	Three key questions need answering. First, do the Government have a regional science policy? The Select Committee on Innovation, Universities, Science and Skills investigated and took evidence, and its Chairman, the hon. Member for Harrogate and Knaresborough (Mr. Willis), explained how the Government appeared to put forward a very confused position both in their evidence and in their response.
	Secondly, why were there cuts to astronomy, particle physics and ground-based solar-terrestrial physics when we were being told that the budget was growing? Was that a mistake? Was it a policy decision? What was behind that situation? Thirdly, has the Science and Technology Facilities Council done its job properly in allocating its share of the budget? I should like to deal with those three questions in reverse order.
	The answer to the third question is the easiest—it is no. The STFC has not done its job properly. I shall not read them out, but Members should read paragraphs 59 and 87 of the Select Committee report. The Committee is chaired by a Liberal Democrat, a genuine Liberal, and for him to use words such as "deplore", "inaccurate" and "unconvincing" to describe the evidence given by the chief executive of the STFC is about as strong as it gets.
	Frankly, I am surprised that, having had that level of public criticism, the chief executive is still in his position. That criticism did not come from nowhere, but was based on evidence. As has already been mentioned, there was no consultation on the international linear collider when funding was withdrawn. The situation on Gemini was ludicrous. First, there was not going to be any funding for those two telescopes, then there was going to be some, then "maybe", then there was going to be funding—it was a hokey-cokey policy that was in and out as far as funding was concerned. That undoubtedly damaged this country's reputation in international astronomy. As the Chair of the Committee said, the evidence given on solar terrestrial physics was at odds with the facts; that is the kindest way of putting it.
	On top of all that, the chief executive held secret reviews of the work going on in the STFC. That demoralised the staff, who did not know what was going on, and the scientific community. It is clear that the STFC did not do its job, and setting up a communications director will not really resolve the issue. There have been some better policy statements since, but while the same people continue at the top of the STFC, the confidence of the scientific community will not return.

Ian Stewart: I agree with the point that my hon. Friend has just made. However, the advent of a communications director was definitely needed so that staff could feel that there was somebody to whom they could go to articulate their concerns about not being consulted. Does my hon. Friend agree?

Graham Stringer: That might have been an important part of the solution, but it is by no means the complete solution.
	My second question was about the funding gap of between £75 million and £80 million, depending on how the figures are looked at. That gap led to some serious scientific research being threatened. It is clear that, as the Committee explained in the report, the gap was there because of the costs of ISIS and the Diamond Light Source. I do not know why the Government had to respond as they did. The Committee was clear. It said:
	"We believe that the Government should ensure that its original commitment to leave no legacy funding issues from the previous Councils is honoured."
	The Government response is an example of sophistry in the extreme; there is no better word for it:
	"The Government welcomes the Committee's recognition in paragraph 36 of its report that STFC did not inherit a deficit from CCLRC, when the new Council was formed on 1 April 2007."
	Well, it did not inherit a deficit, but it did not have the money to fund ongoing commitments. That is a very fine distinction and it is really not worthy of my Government to say that they honoured a commitment. What the commitment meant in plain English was that there would not be any cuts to future programmes; but what the funding situation meant was that such cuts were likely.
	What were the cuts? The one that I am most concerned about was the cut to e-MERLIN and Jodrell Bank. E-MERLIN, a major international astronomical facility, had already had £8 million committed to it. Rather surprisingly—it is worth briefly mentioning peer review—it had been prioritised by the advisory bodies to the STFC as less important than Atlas at CERN. I do not know quite how important Atlas is; I support the large hadron collider at CERN; I do not know whether we will find the Higgs boson or not. I worry rather more about the evaporation of any micro-black holes that may be created; if they do not evaporate, none of us will know about it. That is the real problem at CERN.
	When witnesses talked about the peer review process and the people advising the STFC, both Professor Holdaway and Professor Chattopadhyay—my apologies for the pronunciation—said that they were concerned that that process did not involve consultations with the relevant bodies. They were also worried that vested interests were working against people working outside the organisation, though that applied to the linear accelerators rather than to Jodrell Bank. That was clear in the evidence we took. There may be no better system than peer review—neither the Select Committee nor anyone else has come up with one—but we should not assume that it is perfect. It is not. Elected Members who care about the expenditure of public money and who care about science need to recognise that peer review is an imperfect system that is capable of criticism from both the science community and the political community.
	I shall not repeat what I have said about e-MERLIN and Jodrell Bank, but it is an unhappy situation. We believed that there would be enough money for them, but there has not been; and it is not clear how e-MERLIN and Joddrell Bank were de-prioritised. I hope that the Minister will be able to give a commitment to their future.
	In many ways, the Select Committee spent more time discussing the third subject—I refer to our discussion of the Daresbury campus and the continuation of fundamental science there—than discussing anything else. We received a number of responses. The Government said that they were, are and will be committed in future to the continuation of fundamental science at Daresbury. That is good. Daresbury is in the north-west, so I think that the Government's statement is about where science should take place—in other words, a regional science policy. At the same time, others—I will not repeat the examples cited by the hon. Member for Harrogate and Knaresborough—told us that where science took place did not matter at all. I think that the Government have half a regional policy in that they have a historical policy of commitment to some places outside the south-east.
	As for the Haldane principle and regional policy, if it is the Government's view that their policy is an historical accident and that they are carrying out a political commitment because it would be too embarrassing to jettison it—in truth, they do not want a regional policy and will eventually end up without one—they should not, and cannot, maintain that view. It is impossible not to have a regional policy in science or anything else. If we do not have a stated regional policy, the people who take the decisions on where science investment should go will be in the very places where science is already located. That would be an anti-regional policy, which would end up with investment in the golden triangle between Oxford, Cambridge and the south-east. It is not practical politics to say that there will be no regional policy, because the result will be a negative regional policy.
	When we took evidence about the UK Centre for Medical Research and Innovation, I was concerned that that was precisely what was happening. The professors who came before the Committee were affronted when I asked whether they had considered going to Newcastle, Sheffield or Manchester—my hon. Friend the Member for Norwich, North (Dr. Gibson) suggested Dundee. Their reaction was, "Why should we ever leave London? Why should we leave this cosy triangle?" They should do so because if great cities such as Edinburgh, Manchester, Sheffield and Newcastle increase their knowledge base through investment in science, that will make this country competitive. If there is not a positive policy, that will not happen.
	Does that breach the Haldane principle? I do not believe that it does. The Haldane principle is probably best stated as that
	"day-to-day decisions on the scientific merits of different strategies, programmes and projects are taken by the Research Councils without Government involvement".
	That prompts the question: what is a detailed policy? Clearly, at the level of absurdity, we would not tell someone using a gas chromatograph to use a flame ionisation detector and not an electron capture device. As we go up the scale of science, we must ask whether decisions are for politicians or for the science community. On big scientific projects, expenditure is so high that those decisions must become political ones, whether it is admitted or not. Where such investment takes place does not fundamentally interfere with the principle that detailed decisions on science are taken by scientists. However, huge spending decisions, and decisions on where that money goes, should be taken in respect of a regional policy, and by people who are elected to spend that money.

Gavin Strang: I thank my hon. Friend for his reference to Edinburgh. He knows well its astronomy and physics capability. I strongly applaud his comments on the Haldane principle. If we go back post second world war, we realise that the key work on artificial insemination in Cambridge would probably not have been done had it been left to the Ministry of Agriculture. In fact, a research council was responsible, so we must maintain independence in relation to scientific development.

Graham Stringer: I thank my right hon. Friend for that intervention. It was interesting to read the original 1919 Haldane report. Talking to Members of the other place and this House, Haldane assumed that the scientists would get on with it, because the objectives were clear: to win the war. There was not the assumption, which is sometimes drawn, that the totality of science should be self-governing once the money has been handed over.
	I want to finish on two points, the first of which is related to the discussion about regional science policy and the Haldane principle. Politicians are elected to spend money, and Ministers do that directly in government, and should be accountable. I asked my hon. Friend the Minister for Science and Innovation, "If Jodrell Bank closes, whose head should I ask for?" I do not want to ask for his head, because he is a good Minister. In the final analysis, however, on such big issues, I should know whether the decision has been taken by the chief executive of the STFC or by a Minister. Unfortunately, throughout this process lines of accountability have been breached, and nothing is clear. It is too big an issue to explore this evening, but sadly that has become more typical of Government over the past quarter of a century. Ministers have tried to protect themselves by farming decisions out to principals, non-departmental public bodies or quangos, and saying "Not me, guv" when it comes to the consequences of difficult decisions.
	I agree with other Members that decisions should not be made—and I understand that they will not be made—on the financial structure of science until Wakeham reports. It would be absurd to take a serious look at what are and should be the priorities of science spending, and to continue to make long-term decisions, during the three or four months before the report is published.

Evan Harris: The Library briefing for the debate includes some press cuttings. One article, headed "Everyone loves a man in a white coat", reads:
	"A new book argues that scientists are motivated by sex and status...and they don't need public funding."
	The article, which was published in  The Guardian, continues:
	"It may come as a surprise, but those white-coated chemists beavering away in the university lab are in it for the sex."
	I do not believe that that is true. Certainly the quality of today's debate has shown that those in this place who are interested in science are interested in what flows from that— namely, what we hope will be an evidence-based policy with the right degree of transparency and accountability to enable us to seek to improve the United Kingdom's enviable position in science.
	I think it right to begin, as did my hon. Friend the Member for Harrogate and Knaresborough (Mr. Willis), by recognising the Government's fine record, particularly in comparison with that of the previous Government, but even of itself, in terms of the quantum of funding for and championing of science. Some of the Select Committee's recommendations that seem to criticise the Government, in this and other reports, stem from the fact that the Government are, in a sense, a victim of their own success. They are a victim of the raised expectations to which people in the science world are accustomed.
	When budgets increase by less than the significant amount that scientists expect, they naturally want higher budgets, but if they cannot get those, they do not want the Government to deny their pain. I was not around during the last Conservative Government, but I know that there was a lot of pain to deny. I believe that Ministers said that a tight spending round would mean cuts. It is terrible that those cuts were made: it was short-termism. This is not the time to go into what happened then, but I think that we now need honesty and a recognition of the realities.
	Constituents of mine, in the Rutherford Appleton laboratory and in Oxford university, raised concerns, and I wanted the Select Committee to conduct an inquiry. I am pleased that my colleagues in the Committee agreed to include in our general scrutiny of research councils specific decisions about science budget allocations by the STFC. I pay tribute to members of all parties who were prepared to compromise, and to ensure that the eventual report was very clear. While I am speaking from the Front Bench, let me observe that science need not be too party political. I think that that was exemplified by the conduct of the Select Committee under the excellent chairmanship of my hon. Friend the Member for Harrogate and Knaresborough.
	Both the hon. Members for Esher and Walton (Mr. Taylor) and for Manchester, Blackley (Graham Stringer) mentioned peer reviews. As my hon. Friend the Member for Harrogate and Knaresborough said, they are better than any other method that has been considered for the making of decisions about the merit of a scientific case in the context of either publication or funding. Nevertheless, I do not think it appropriate to claim that peer review as it currently operates in the United Kingdom is anywhere near perfect. I believe that two reports from the old Science and Technology Committee suggested to its successor that an inquiry be conducted into how the current peer review system could be improved. As Committee members know, because I say this regularly, I still think that that should be done. The stakes are enormously high in terms of getting peer review right, both for individual careers and for getting decisions right.
	Today, importantly, we have had strong, but measured and evidence-based, criticism of the Government in this matter from Labour Members. I agreed with pretty much everything that the hon. Member for Manchester, Blackley said, except his concern that we ought to be worried about micro black holes. I am not convinced by that, although I guess it makes for a good story on the "Today" programme.
	The report has messages that the Government must heed and take cognisance of. I share the view of other Members that it was disappointing that the Government did not seem to acknowledge any way in which they could improve matters, except by renaming the science budget. I look forward to the Minister accepting—I hope he accepts that he will not be criticised for this—that improvements could be made to the Government's performance. For example, the reputation of this country, not just in science but as a collaboration partner, is at stake. Sir Keith O'Nions accepted that there was the potential for harm to the UK's reputation in international partnerships either by decisions that were hard to understand or by decisions that were unnecessarily precipitate and did not seem to be based on adequate consultation or adequate peer review in terms of the quality of the process as well as the outcome.
	The reputation of the UK is increasingly important because so much science is now done in big international collaborations. A few members of the Select Committee present here had the pleasure and privilege of going to see the large hadron collider before it was closed. My view of that could be described in one word: "Wow"—"Wow" at the scale of the undertaking, at the scientific ambition in terms of the questions it will answer and at the recognition there by the scientists of all nationalities of the UK's contribution. Concern was raised there—the Committee touched on that in the report—about whether that was to be maintained.
	Although there was a firm commitment by the STFC to continue to invest in ATLAS and the big experiments, there were two smaller experiments—LHCb and ALICE; not the ALICE at Daresbury, which forms part of the RLP programme, but another one—which were categorised as medium or low priority. I noticed in the revision to the delivery plan published in the last few days by the STFC that LHCb has been upgraded, but I could not find in a sea of acronyms the right one for what was happening to the UK's commitment to the ALICE experiment at CERN. I remain concerned about that. I do not know whether the Minister could wade through the acronym soup in the document that we received to find that out for me. Those are small experiments but they are international partnerships at CERN.
	The themes that have come out of the debate are the overall level of funding, dealt with by the hon. Members for City of Durham (Dr. Blackman-Woods), for Esher and Walton (Mr. Taylor) and others, the direction of funding and whether too many cross-cutting programmes are determined by Government, sapping the room for manoeuvre of individual councils. I gave a speech this morning at a conference on cellular senescence, the molecular biology of ageing. The Biotechnology and Biological Sciences Research Council was represented there and set out clearly what its contribution was to a cross-cutting programme. Ageing is one of the cross-cutting programmes that the Government have laid down and there is nothing wrong with that.
	Another issue was transparency and I shall dwell on two points, one of which is the transparency of the process. This point was introduced by my hon. Friend the Member for Harrogate and Knaresborough in respect of whether the Government essentially interfered, legitimately or illegitimately—I will come to that—in the scientific plans of research councils, through the CRS process of asking to see draft delivery plans, there being a view from Government about whether those were adequate. New plans would then come back and the funding would be signed off. If the delivery plans in effect say, "We're thinking of this because we think project A has scientific merit", and the Government response in effect says, "Well, we think project B is the one that ought to be funded, and if you come back to us with that recommendation, you will be rewarded in the comprehensive spending review," that will clearly be an example of the Government having an influence over strategic, or even sub-strategic, decisions. We will not know whether that has taken place or not, because we cannot see both sides of the correspondence.
	It is interesting to note what the Government said on this in respect of the Arts and Humanities Research Council in response to the Select Committee conclusion in paragraph 116 of its fourth report. The Committee said:
	"It seems to be a breach of the Haldane Principle that the Government should direct a Research Council to switch funding from postgraduate awards to programme funding merely on the basis of it being out of step with other research councils, or indeed for any other reason."
	The reason is, I think, not material. The Government said:
	"All Research Councils were asked to prepare Delivery Plans for publication which reflected the activities that the Council proposed to support once it knew its actual allocation. The draft Delivery Plans were subject to discussion between the relevant Research Council and the Government, to check that they reflected the plans submitted by Councils in response to the scenarios commissioned earlier in the allocations round, and the terms of the Councils' specific allocation letter".
	That gives the Government a lot of scope to influence the decisions of the research council at a strategic, or even sub-strategic, level.
	The Minister might be surprised to hear this, but I do not think that if the Government were transparent about doing that, there would necessarily be anything wrong with that. It is public money, and as long as politicians do not intervene in the peer review process to change the judgments made about the scientific merit of the proposals—there might be a danger of that, but if there were transparency it would be dealt with—the Government are entitled to say, "We want to have more spending on ageing" or cross-cutting on stem cells. They will have to defend themselves for doing that because there is an opportunity cost, but they are entitled to do so as they are in charge of public funding. However, if they do that, it has to be transparent. They cannot have it both ways, as it would be corrosive if there were a feeling that scientific decisions were being interfered with in a way that was not open.
	The same applies to regional policy. I represent a constituency in the golden triangle, but I think that it would be legitimate for the Government to say, "In this science budget, we think a certain proportion should be spent in all regions"—or a particular region, perhaps—"as a matter of Government policy, and we are accountable for that, as people can vote for us or not." However, the Government cannot seek to have it both ways by saying, "We do not interfere with decisions about where specific projects go, but Daresbury, for example, will be a science and innovation centre". I think that the Minister has to accept that that implies there will be some large science there, otherwise he would have to accept that it was not going to be a science and innovation centre. We need to know whether this is more than a case of fingers crossed.

Ian Taylor: This issue has come up several times, and I want to remind Members that there was a trade-off. When the Diamond synchrotron was going to be placed in Oxford—a decision I thoroughly supported—north-west Members were less than happy. I do not blame them for that, but there was a straight trade-off. It is now being dignified with the concept of regional policy, but it was a straight trade-off.

Evan Harris: There was an article in  The Guardian on 20 May that recaps the debates. It set out:
	"When Daresbury lost the Diamond facility to Harwell, Lord Sainsbury, the science minister at the time, gave an assurance that if 4GLS"—
	a fourth-generation light source—
	"were built, it would be sited at Daresbury. On the loss of Diamond, Sainsbury said"—
	at the time, I think—
	"'If people in a particular research establishment come up with a brilliant new way of doing things, it is not a clever strategy when it comes to building the thing to take it away and put it somewhere else. It is not a good way to motivate people to come up with new ideas.'"
	One would think that that combination suggested that he was clear that, if he were still science Minister he would direct funding towards Daresbury. However, he goes on to deny—now, I think, as I assume these are contemporaneous comments—
	"that too much funding is concentrated in the golden triangle",
	and he says:
	"I think it would be wrong to try and distort the research council process. It is difficult to ask people to allocate funds on two sets of criteria. Either it is done on the excellence of the research or it is done on other criteria."
	Actually, it could be done on a mixture, as long as that was made clear, and regional factors played a part.
	I resented the allegation made in Westminster Hall on 1 April by the hon. Member for Weaver Vale (Mr. Hall) who, without informing me that he intended to make the point—I have informed his office that I intended to complain about it—said that I had called for Daresbury to be closed. Members of the Committee who attended the evidence sessions and the visits will know that my concern was that the Government should be clear and honest with Daresbury about its future, because we are dealing with people and their careers. The people to whom we spoke said that the Government said that it had a bright future, but the decisions made by the STFC told them otherwise. That is why it is important that the Government are willing to engage with the Committee's recommendation to start a debate, perhaps through a White Paper, on regional policy on science. It may be that the Minister does not know the answer, and the Government should not be criticised for not having the right answer, but we should at least have the debate.
	I turn now to the recommendation made about the research council itself. Questions are always raised in Select Committee inquiries about who is to blame, and the temptation is to blame the research council staff—and we strongly criticised them. However, the danger is that that is seen as scapegoating someone who has to make difficult decisions. It is true that the Committee said that those decisions were made badly, but sacking the management is not necessarily the answer, because the problems will live on.
	I was concerned that the STFC may have misinterpreted one of our recommendations, which was to improve communications. I do not think that that meant that it should improve its spin. The announcement sent by e-mail on 3 July included a list of highlights of the STFC funding programme, and I looked down it to find some lowlights, because I expected that some of the cuts—some of which have been confirmed and are uncontentious—would be mentioned. However, none of the cuts was mentioned except the ExoMars mission, on which it states:
	"The ExoMars mission...is supported by STFC through its subscription to the European Space Agency's Aurora Programme."
	However, that disguises the planned and agreed cut. I even waded through the executive summary of the report, and no mention was made of cuts. Then I went to the individual pages, and it is hard to find the answer for some of the projects. On solar-terrestrial physics, the implementation document merely states:
	"The agreed programme of support for STEREO PLS will be continued."
	It is my understanding that the agreed programme of support is actually a cut. It states:
	"The agreed programme of support for Hinode PLS will be continued".
	That is another cut. The document also states:
	"The agreed programme of support for Cluster, SOHO PLS and the UKSSDC will be continued",
	which is another cut. I am not criticising the decision, but the STFC should be more open. We have communication, but it is the wrong kind of communication. It is unclear whether Daresbury will receive significant investment in respect of the ERLP-ALICE project for the future.
	The Committee's report was a balanced one, and—notwithstanding that I am a member—I think that it should be congratulated. The contributions that we have heard today should focus the Minister's mind on the challenge he faces to restore the confidence of the physics community in those who govern its budgets.

Brian Iddon: In this debate on the science budget allocations, I rejoice in the simple fact that under a Labour Government—my Government—the science budget will have doubled in real terms by the financial year 2010-11. We all visit colleges of further education, university and industry—anywhere the science base operates—and we now see some amazing things being done. I say thank goodness for that, because the future of this country relies on added value and our science and innovation.
	I believe that the two major reviews that have been mentioned, one published by the noble Lord Sainsbury and the other by Sir David Cooksey, have influenced the way in which scientists, and perhaps the Government, have been thinking about the future of science. Nor should we forget that the three national academies have received extremely good settlements. The Royal Academy of Engineering received an increase of 31.5 per cent., the British Academy received an increase of 23.7 per cent. and even the Royal Society received an increase of 18.2 per cent. Those are significant increases.
	When I was elected to Parliament in 1997, the UK science base that I left was in the doldrums. I remember that every year in my department—the department of chemistry and applied chemistry at the University of Salford—the central library sent us a list of essential journals and publications, and we had to go down the list and decide which of them we would cut out of our research budget. That happened not for one year, but for two or three. Essential posts remained unfilled. No maintenance was done. We did not have the money to replace our nuclear magnetic resonance spectrometers. Large instruments across the infrastructure lay unreplaced for decades. That was no way to conduct research in Great Britain.
	When the research assessment exercise came along, science and engineering departments that carried out applied research suffered badly. Nearly all the departments that relied almost entirely on applied research are now closed—including the three great engineering departments at the University of Salford and even my old department, which was the largest chemistry department in Britain when I taught there.
	Today, the picture is quite different. The infrastructure in our universities has been improved, in my opinion, beyond recognition since 1997, with huge investments not only in buildings but in other major capital schemes. The instruments that were not bought in 1997 are all there now. There are some superb instruments in some superb departments.
	I visit the University of Manchester regularly, as I am on the external advisory body of the school of chemistry there. Every time I visit, there are cranes lifting things backwards and forwards and new buildings going up. I visit the laboratories, as I have for decades. I have never seen such state-of-the art laboratories as those I can now see by walking into any science department at that great university.
	We have pulled ourselves up to be the second in the world, behind only the United States, in the citation ratings for papers published by British scientists. Let us not forget, either, that the Labour Government came to power at a time when we had a job retaining graduates for postgraduate studies. We recognised that problem and one of the first things we did was to increase the remuneration for MSc and PhD students. That remuneration is not brilliant, but it is better than it was—in fact, it is double what it was—under the previous Government.
	The Government should be congratulated on those significant increases in the UK science research base, not only because of the research grants that they give through the science research councils but because of the major investment to which I just referred. Regrettably—I cannot understand this—the Government are instead under fire, despite all that progress. So what went wrong? Why have the Secretary of State for Innovation, Universities and Skills and the Minister for Science and Innovation been on the back foot, instead of on the front foot where they should proudly be?
	The simple explanation, in my opinion, is that the two major reviews that I have just mentioned, combined with the significant shift in research priorities to meet the needs of a modern society, have resulted in significant cuts in some research programmes. Let us not forget that other research programmes have benefited significantly. There has been a significant shift in the Medical Research Council research budget and the Biotechnology and Biological Sciences Research Council research budget—a shift towards the life sciences, perhaps, and away from the physical sciences. Let us not believe that the money is not there; it is just being moved around.
	Let us consider the Haldane principle. It was established in 1919 and recommended that non-departmental specific research should be managed through research councils—that is, that decisions on expenditure should be determined by scientists rather than by politicians. Ninety years later, that principle is still in place. Our Select Committee concluded that perhaps it had been breached. In addition to full economic costs, the research councils have had other significant expenditure. The Technology Strategy Board and the Office for Strategic Co-ordination of Health Research have been mentioned, and we should also mention the Energy Technologies Institute. The creation of those three institutes alone has required a considerable shift in funding. We are talking about agreements made by scientists—people in the field—and not entirely by Ministers. However, I do not have time to go into the details.
	The seven research councils have decided to go for interdisciplinary research like never before, and our Select Committee has pressed them to do so. We have said that we are fed up with the research councils being like seven silos, with the scientists in one silo never talking to those in the other six. They are now beginning to talk to each other. Research Councils UK was established, but it did not really bring that about. I hope that the identification of six significant areas that will benefit the public, whom we represent, has now been recognised. Some of those areas have already been mentioned.
	The question is whether the Government have breached the Haldane principle. Our report suggests that they have. The July issue of  Chemistry World was published just a few days ago, and I want to cite two articles in it by distinguished gentlemen. The first is by Randal Richards, who is no lightweight in the field of science. He recently retired as director of research and innovation at the Engineering and Physical Sciences Research Council, and latterly he was its interim chief executive. He wrote a letter to  Chemistry World, and I shall quote part of it:
	"The six cross-council research themes were identified by the research councils themselves. The fact that some of these themes coincide with public policy challenges identified by the government should not be surprising because they include some major scientific and technological changes that are world wide—sustainable energy and environmental change, for example."
	He rejects the suggestion that the EPSRC, and by extrapolation the other research councils, has failed to conform with the Haldane principle. He reminds us that the research councils were
	"pretty quick about reminding government and officials"
	when they withdrew end-of-year flexibility resources to the tune of £70 million in the last financial year.
	According to another article in the same issue of  Chemistry World, the former chief scientific adviser to the Government, Professor Sir David King himself, strongly defends the science budget in the 2007 comprehensive spending review. I shall quote just a small part of his article:
	"What we're actually talking about is the distribution and the management of the cake, not the size...The priorities of the 21st century are different from the priorities of the...20th century. Historical budgets, and the distribution of money within...research councils, shouldn't be engraved in stone."
	Sir David also suggests that scientists have not been pushed into doing what they do not want to do. He says:
	"The bottom line is, it's very difficult. Does there have to be a choice between finding the next fundamental particle by building a bigger and more expensive successor to Cern, versus putting money and the best brains into tackling environmental issues? I think that's a debate that ought to be out in the open—it's not, because people are simply defending their own...corner."

Adam Afriyie: This has been a fascinating debate. To those of us with a scientific and constituency interest in many of the projects mentioned, it has also been an enlightening and encouraging one.
	I thank the hon. Member for Harrogate and Knaresborough (Mr. Willis) for his work as Chairman of the Innovation, Universities, Science and Skills Committee and for his excellent opening words. He is a champion of science and a scientific approach here in Parliament and elsewhere. Perhaps when he steps down from this House—at the next election, I understand—he might step up to the challenge of enthusing the next generation in the same way as he has enthused us in Parliament. As a former member of the Committee, I miss the enthusiastic and energetic inquiry into and rational analysis of cross-departmental scientific issues that take place under his most able chairmanship. He and all members of the Committee can be rightly proud of their review of the science budget allocations and the STFC. The evidence sessions that preceded it revealed some deep concerns running through the science community. Many of those concerns were emphasised in contributions from both sides of the House, which were heartfelt, well presented, rational and thoughtful. The hon. Gentleman was eloquent and articulate in his exposition of the potential for inappropriate interference by Ministers in the allocation of budgets.
	The hon. Member for City of Durham (Dr. Blackman-Woods) was measured in her comments. She rightly recognised the £80 million shortfall as such—a shortfall rather than a cut. She also said that there was some distance—I think that that was a euphemistic phrase—between the research budget allocations and the number of research grants.
	My hon. Friend the Member for Esher and Walton (Mr. Taylor), who was a Science Minister in the previous Conservative Government, was straightforward in his historical analysis of the events that led to the current situation. I would build on that merely by saying that the main reason such a large amount of resource is available for the science budget is that the previous Conservative Government delivered the conditions in which the current Government have been able to spend.
	The hon. Member for Norwich, North (Dr. Gibson) emphasised that a broader membership of the research councils, with younger members and wider citizens' involvement, might be useful. He painted an idyllic picture of science cities and strongly approved of the enlarged science budget. The hon. Member for Castle Point (Bob Spink) made some interesting observations on peer group review.
	The hon. Member for Manchester, Blackley (Graham Stringer) was very forceful in his comments. He said that the funding gap that has appeared is not worthy of his Government—a passionate and forceful statement. He also said it is impossible not to have a regional science policy. That has been mentioned to the Minister many times before, and I suspect that it will come up time and again until there is clarity. Rather than pushing a particular point of view, I simply urge the Minister to create that clarity.
	The hon. Member for Oxford, West and Abingdon (Dr. Harris) said that what is required from the Minister is honesty in recognition of realities; I certainly agree with that sentiment. He referred to the potential breaching of the Haldane principle, with Ministers perhaps looking at draft plans and then new plans being submitted, and expressed concern that we have not had sight of that interaction.
	Finally, the hon. Member for Bolton, South-East (Dr. Iddon) broadly welcomed the increase in financial resource available to the Minister to disburse, and pointed out that we are second in the world for citations, after the US, which is a great place for us to be.
	Despite some of the deep concerns and challenges facing UK science, I am nevertheless optimistic for the future. Amid the fears of job losses and budget cuts, I recently visited Daresbury science and innovation campus to see some of the innovative ways in which scientists and entrepreneurs were working together, and it was very encouraging. Just last month, I was at the Diamond Light Source project in Oxfordshire—a truly world-class facility that attracts scientific and commercial interest from across the globe, and I think that there are greater opportunities to realise some of that commercial interest in a more fruitful way in future.
	I remain optimistic for the future, not least because it is clear that hon. Members of all parties care deeply about the future of UK science. Admittedly, in part that may be because many of us have scientists living and working in our constituencies who face the prospect of redundancy, grant reductions or the withdrawal of facilities—although perhaps not to the extent that is occasionally portrayed in the media. To an even greater extent, I am optimistic because we understand the important role that science plays in society. At a time when science promises so many answers to some of the big questions, we must take care over decisions that might scale back important activity.
	In climate change, energy and food security, we look to scientists for answers. The taxpayer supports science in this country because of the benefits that accrue to the nation as a whole. But as the report of the Select Committee on Innovation, Universities, Science and Skills has shown, a "poorly allocated" budget has forced damaging cuts that threaten the capacity and perhaps the international reputation of UK science. Despite increased investment for the Medical Research Council, among one or two others, everyone but the Government seems to agree that the science budget left the STFC with an £80 million shortfall. The Select Committee concluded that the Government must "demonstrate greater effectiveness" in the way it manages research in the UK, which is putting the point quite lightly, given the concern that the science budget has provoked.
	It will come as a relief to many that the STFC announced last week that it had balanced its budget. We now know that some of the high-profile facilities, such as ALICE—accelerators and lasers in combined experiments—at Daresbury and e-MERLIN at Jodrell Bank, may be safe. My first question to the minister is this: did he have a hand in saving those headline projects? Perhaps he can clear up that matter. Was he involved in the discussions before the press release was issued last week? Was he or his Department informed about the STFC announcements before they were made? If he was, there are more questions to be answered about what influence the Minister may have brought to bear.
	Despite the celebration about the saving of Jodrell Bank and one or two other headline facilities, we must not forget what will disappear, and I will quickly put some of those projects on the record. Astronomy has been hit quite hard. AstroGrid, which is developing an open-source eye on the sky, will lose funding. Support for the Birmingham Solar Oscillations Network and the Cambridge Astronomical Survey Unit will go. The STFC aims to sell 50 per cent. of the UK's observing time in Gemini. The UK's contribution to the Isaac Newton group of telescopes, described by the Particle Physics, Astronomy and Nuclear Physics Science Committee—PPAN—as a "valuable asset", will fall by half. There will be a withdrawal of support from the particle physics collaboration at Stanford university. Because of funding constraints, PPAN
	"reluctantly had to leave the project terminating rather abruptly, recognizing the loss of science this would incur".
	Perhaps what is more alarming is that with the settlement offered by the Government, the STFC has been forced to reduce the number of research grants over the coming spending review period. A statement from the STFC council reads:
	"Because of the funding cycle the number of"—
	post-doctoral research assistants—
	"in Nuclear Physics will be reduced by circa 22 per cent."
	In astronomy, the
	"STFC's published delivery plan envisages that the number of PDRA's supported in 2011 will be 11 per cent. below the 2005 level".
	The overall headline figure that the STFC gave for reductions in new commitments to research grants was 25 per cent. That means fewer astronomers, fewer particle physicists and fewer nuclear scientists. However, the Government appear to be contradicting the research councils. They said in their response to the report that
	"the level of rolling grants for particle physics will be unaffected until at least 2010—11."
	However, the STFC stated in its programmatic review that where specific programmes were cut,
	"the level of existing rolling grants"
	would be "reduced accordingly." Will the Minister explain how the level of rolling grants can be reduced and unaffected at the same time? That is a bit of a contradiction.
	One the one hand, we have a Prime Minister who says that we must push ahead with nuclear power; on the other hand, we are cutting back nuclear science to a certain degree through the STFC funding allocation. Such incoherence causes some concern. As Professor Hawking has said:
	"This bookkeeping error has disastrous implications...These grants are the lifeblood of our research effort; cutting them will hurt young researchers and cause enormous damage both to British science and to our international reputation."
	The Government did not make hay or fix the roof while the sun shone. We all know that they failed to make provision when the economy was doing well, and today the pressures on the public purse are many and varied. At a time when science promises solutions to many of our social and economic needs, Ministers cannot afford to bury their heads in the sand. What Professor Hawking described as a "bookkeeping error" has implications for scientists up and down the country.
	The recent crisis represents either departmental incompetence—missing the cuts that were self-evident in what was presented to it—or a deliberate decision to provide the research councils with less than was needed. Either way, the Minister has an opportunity today to be courageous. We have heard that word once or twice, and we have heard the call for transparency and openness. We have heard about the boldness and courage of former Science Ministers, who were very clear and open about what they were doing when there was a budget reduction. Will the Minister admit that there has been a shortfall in funding for the STFC and say that he accepts some responsibility?

Ian Pearson: The Government welcome the report of the Select Committee's inquiry into the science budget allocations, and we very much welcome this debate. I appreciate the overall constructive way in which the hon. Member for Harrogate and Knaresborough (Mr. Willis) raised the issues mentioned in the report. There are clearly matters on which we continue to disagree, and I do not think that his characterisation of our response to the report was accurate. We have taken its recommendations carefully into account and, in many cases, agreed with them. The report has been very helpful to us. We set out our position in a positive response, and I am pleased to have this opportunity to discuss the issues involved further.
	As has been mentioned, the science and research budget has doubled in real terms from £1.3 billion in 1997 to £3.4 billion in 2007-08. The new comprehensive spending review allocation means that the budget will increase to almost £4 billion in 2010-11. That is an average increase of 2.7 per cent. a year in real terms over the next three years. Within a tight financial framework, that is a strong settlement and highlights the Government's long-standing support for science and research in the UK, as set out in our 10-year science and innovation framework. I was very pleased that the hon. Members for Harrogate and Knaresborough and for Oxford, West and Abingdon (Dr. Harris), and Labour Members, recognised that strong support for UK science.
	In allocating the science budget, our overriding objective was to ensure the continued excellence of the UK research base. Hon. Members would expect nothing less. The Government are committed to supporting fundamental research that expands the frontiers of knowledge. It is important to recognise the wider benefits of such research. It produces highly skilled people, drives innovation, attracts inward investment and can be translated into many successful products and services. Research and innovation improve our productivity as a nation, thus providing the means for our creation of wealth and directly benefiting and underpinning key public services in everything from health care to defence.

Ian Stewart: Does my hon. Friend accept that there must be a balance between pure research and commercial exploitation and that, although one can conduct pure research on its own, one cannot do the commercial exploitation without the research? The balance must be right. When the Select Committee visited the observatory in Edinburgh, it was clear that the people there were excited about being asked to do more commercial work but felt that it should be recognised that that commercial work had previously been restricted. The balance must be right so that a facility does not simply become a science park.

Ian Pearson: I agree that, in all such cases, it is a matter of balance. However, I remind my hon. Friend and the House that the Government are committed to investment in basic research. That underpins the later commercial exploitation of research. As he knows, we support some of that commercialisation and applied research and development through, for example, the Energy Technologies Institute and especially the activities of the Technology Strategy Board, which will spend, in co-ordination with the research councils and the regional development agencies, £1 billion in the next three years.

Ian Stewart: I thank my hon. Friend for his patience. Does he accept that the principle that he outlined must apply to centres such as Daresbury so that they do not become only science parks?

Ian Pearson: Yes, I do. I have said on record—and will continue to say—that the Government want Daresbury to develop as a world-class centre for science and innovation. We do not perceive its future as a technology park, as some have suggested. I shall say more about that later, especially in response to my hon. Friend the Member for Manchester, Blackley (Graham Stringer), who made an important contribution about regional policy.
	It is critical that every possible benefit is extracted from our world-class research base. That is why driving up the economic impact of research goes hand in hand with supporting excellent science. By operating in that overarching policy framework, Government support has helped the UK research base sustain a strong global performance.
	Citations have been mentioned this evening. The UK has the most productive science base of any country in the G8. At the same time, knowledge transfer between research and business continues to grow. UK universities are now producing spin-out companies of equivalent number and quality to some of the top US institutions. Since 2003, 30 companies have been floated on the stock exchange at a value of £1.5 billion at initial public offering. Furthermore, several high-profile trade sales have taken place, including seven in the past two years, which raised £1.9 billion. University income from business and user engagement has risen rapidly and now stands at about £2 billion a year.
	It is the Government's duty to set the strategic direction for the research base. We have discussed that in great detail this evening. To do that, the Government took several high-level decisions when allocating the science budget. Over the period of the comprehensive spending review 2007, research will be funded at 90 per cent. of its full economic cost; the Sainsbury and Cooksey reviews will be implemented, and we will support collaborative projects involving the Technology Strategy Board and the Energy Technologies Institute. We will also support research in matters of strategic importance to the country—for example, in medicine and on key challenges such as energy supply and the environment. Again, we heard strong support in the debate for more cross-disciplinary research, which is guaranteed in the comprehensive strategy review 2007 settlement.
	I know that there is keen interest in the relationship between the Government and research councils, especially in the way in which research funding is prioritised and managed. That is not surprising. As hon. Members know, for many years, the British Government have been guided by the Haldane principle. Detailed decisions on how research money is spent are for the research community to make through the research councils, once the Government have set the overarching parameters. The basis for funding research is also enshrined in legislation, through the Science and Technology Act 1965. The allocation of the comprehensive spending review 2007 science budget is consistent with Haldane, and I am happy to debate that this evening.
	My right hon. Friend the Secretary of State for Innovation, Universities and Skills recently restated the Government's position on the Haldane principle in his speech at the Royal Academy of Engineering in April. He made it clear that it is researchers, through their participation in peer review, who are best placed to determine detailed research priorities. The research councils act as
	"guardians of the independence of science".
	The Government's role is to set the overarching strategy and framework. Haldane is fundamental to the health of our excellent research base and its strong economic impacts, and is underpinned by peer review, which we have also debated at some length this evening.
	Research councils fund research on a competitive basis following independent expert peer review. I would be the first to admit that improvements could probably be made to the peer review process, but no system is absolutely perfect and it has stood the test of time. The system is regarded as an international benchmark of excellence in research funding and provides a guarantee of the quality of UK research.
	Peer review processes are sensitive to the different needs and cultures that exist in the academic community. They support different types of research and encourage adventurous or multidisciplinary research. For peer review to work, senior researchers must give up their time to provide valuable expertise. A number of eminent scientists assist research councils in making difficult decisions. It is important for the Government and researchers to defend peer review robustly.
	That is the context in which we said in our response to the Committee that we felt that some of its comments were unhelpful and damaging. We thought that they undermined the efforts of individual researchers who quite rightly give a lot of their valuable time to participate in what is, overall, an internationally well recognised and respected process.

Evan Harris: It is important that the Minister should deal with peer review, and I am grateful to him for doing so. He said in his response that the Committee ought to be careful in what we say when we criticise the peer review process, because it might make it difficult to attract internationally renowned scientists to participate, but is that not a lose-lose situation? The Minister has accepted that there are problems with peer review. Surely it is the right of a Select Committee to say so too, even if that has the effect of deterring people.

Ian Pearson: Let us be clear about what I said. I said that no system was perfect. I am sure that the peer review process has scope for improvement, and that is something that research councils look at regularly to ensure that the structures are right. However, I shall say something more on that in a moment.
	The key point is that the Government understand clearly why those whose work is not funded may question those who gave it a lower priority. However, that is all the more likely in a scientifically strong nation, which thankfully we are in the United Kingdom, where rejected research proposals are of real scientific quality. We have heard mention this evening of a number of detailed projects, some of which have been regarded as a low priority. In an excellent research nation, there will have to be winners and losers. However, it is hard to conceive of an alternative that does not shift responsibility for making detailed decisions away from scientists.
	I reject the comments of those, not least the hon. Member for Tatton (Mr. Osborne), who say that Ministers should intervene and take the detailed decisions on which areas of science should be funded. That would involve scientists spending their time lobbying Ministers to get funding, instead of those decisions being made through peer group research. The Government do not want to see the success or failure of detailed lines of research being determined by political lobbying, and we will not intervene to take decisions that should properly be taken after peer review by the scientists in the research councils.
	A number of projects have been mentioned, including e-MERLIN, ALICE and EMMA. This refers directly to a comment made by the hon. Member for Windsor (Adam Afriyie). It is not the Government's responsibility to take decisions on such projects. It is the responsibility of individual research councils to do so, and that is what they have done through the comprehensive spending review process.

Adam Afriyie: Will the Minister categorically confirm here and now that he and his Department had no involvement in the decisions that were made last week by the STFC? Will he also release the information on the discussions that took place between the STFC and his Department as the draft plans were going backwards and forwards?

Ian Pearson: I shall talk about delivery plans in a moment—[ Interruption.] What I can say in response to the hon. Gentleman is that, through our officials, the Government want to work closely with the research councils. That level of communication is exactly what hon. Members would expect, but it is ultimately up to the research councils to make detailed decisions on projects. It is simply not right for the Government to interfere in those detailed decisions, and we do not do so.
	I should like briefly to talk about the detailed draft delivery plan process. The rationale was to ensure that each council undertook a rigorous prioritisation process. We did not wish to second-guess or take decisions for the research councils. We wanted to ensure that a robust process was followed.
	The STFC has been referred to by many hon. Members this evening, and the first thing that I want to do is acknowledge the concerns that have been expressed in the particle physics and astronomy community about the science budget allocations. Those concerns were reflected in the Select Committee's report. Hon. Members will be aware that, last Thursday, the STFC announced the results of a programmatic review. It will be holding a meeting tomorrow at which the outcome will be discussed with scientists themselves.
	The Department considered that the final delivery plan drawn up by the STFC, following the receipt of its allocation in October 2007, raised two strategic issues that merited further independent advice. That is why we asked Sir Tom McKillop to extend his work with the Northwest Regional Development Agency to advise on the future development of the Daresbury campus, and asked Research Councils UK to initiate a review of the health of physics as a whole, given the interest of a number of research councils in this subject. People sometimes forget that physics is funded by a number of the research councils, to the tune of more than £500 million a year at the moment—and that is on a rising profile over the CSR period.
	The Government are working with the STFC to review the way in which its allocation was handled, and to ensure that all the relevant lessons are learned for the future. In particular, the STFC has recognised that it could have communicated its plans better, and it is taking steps to address that. The STFC will take account of these lessons as it takes forward the organisational review, which will cover strategy and planning, customer and stakeholder engagement, governance and risk-management processes, delivery, value for money and the management of change.
	Before I conclude, I should like to respond to some of the comments made by my hon. Friend the Member for Manchester, Blackley on science policy. We have a clear 10-year framework that provides a statement on the Government's science policy. We say very clearly that public funding of research is dedicated to supporting excellence, irrespective of its UK location. That policy remains firmly in place. My response to him is that investment in the development of Daresbury—to which I am very committed—and Harwell will take place on the basis of their being world-class campuses for science and innovation, not on the basis of their geographic location. He will be aware that I have a long-standing interest in regional policy, and I hope that we will have the opportunity to discuss science cities and clusters. My hon. Friend the Member for Norwich, North (Dr. Gibson) mentioned his desire to develop Norwich as a science cluster. There is great potential there, and it is a subject on which we can have further discussions.
	 It being Ten o'clock, Mr. Speaker  proceeded to put forthwith the deferred Questions relating to Estimates which he was directed to put at that hour, pursuant to Standing Order No. 54 (Consideration of estimates )

ESTIMATES, 2008-09
	 — 
	DEPARTMENT FOR TRANSPORT

Resolved,
	That, for the year ending with 31st March 2009, for expenditure by the Department for Transport—
	(1) further resources, not exceeding £8,777,927,000, be authorised for use as set out in HC 479,
	(2) a further sum, not exceeding £7,136,325,000, be granted to Her Majesty out of the Consolidated Fund to meet the costs as so set out, and
	(3) limits as so set out be set on appropriations in aid.

DEPARTMENT FOR INNOVATION, UNIVERSITIES AND SKILLS

Resolved,
	That, for the year ending with 31st March 2009, for expenditure by the Department for Innovation, Universities and Skills—
	(1) further resources, not exceeding £11,040,399,000, be authorised for use as set out in HC 479,
	(2) a further sum, not exceeding £12,519,763,000, be granted to Her Majesty out of the Consolidated Fund to meet the costs as so set out, and
	(3) limits as so set out be set on appropriations in aid.
	Mr. Speaker  then put the Questions required to be put, pursuant to Standing Order No. 55 (Questions on voting of estimates, etc).

ESTIMATES AND SUPPLEMENTARY ESTIMATES, 2008-09

Resolved,
	That, for the year ending with 31st March 2009—
	(1) further resources, not exceeding £233,217,986,000, be authorised for use for defence and civil services as set out in HC 479, HC 486, HC 487, HC 488, and HC 621,
	(2) a further sum, not exceeding £230,753,553,000, be granted to Her Majesty out of the Consolidated Fund to meet the costs of defence and civil services as so set out, and
	(3) limits as set out in HC 479, HC 487, HC 488 and HC 621 be set on appropriations in aid.
	 Ordered,
	That a Bill be brought in on the foregoing resolutions: And the Chairman of Ways and Means, Mr. Chancellor of the Exchequer, Yvette Cooper, Angela Eagle, Kitty Ussher and Jane Kennedy do prepare and bring it in.

Consolidated Fund (No. 2) Bill

Jane Kennedy accordingly presented a Bill to apply certain sums out of the Consolidated Fund to the service of years ending on 31 March 2008 and 2009: And the same was read the First time; and ordered to be read a Second time tomorrow, and to be printed. Explanatory notes to be printed [Bill 130].

DELEGATED LEGISLATION

Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Standing Committees on Delegated Legislation),

Prisons

That the draft Northern Ireland (Sentences) Act 1998 (Specified Organisations) Order 2008, which was laid before this House on 14th May, be approved. —[Mr. Blizzard.]

Mr. Speaker: I think the Ayes have it.

Hon. Members: No.
	 Division deferred till Wednesday 9 July, pursuant to Standing Order No. 41A (Deferred divisions).
	 Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Standing Committees on Delegated Legislation),

Capital Gains Tax

That the draft Double Taxation Relief and International Tax Enforcement (Taxes on Income and Capital) (Saudi Arabia) Order 2008, which was laid before this House on 19th May, be approved. —[Mr. Blizzard.]
	 Question agreed to.
	 Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Standing Committees on Delegated Legislation),

Taxes

That the draft International Tax Enforcement (Bermuda) Order 2008, which was laid before this House on 19th May, be approved. —[Mr. Blizzard.]
	 Question agreed to.
	 Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Standing Committees on Delegated Legislation),

Criminal Law

That the draft Crime (International Co-operation) Act 2003 (Designation of Participating Countries) (England, Wales and Northern Ireland) Order 2008, which was laid before this House on 4th June, be approved. —[Mr. Blizzard.]
	 Question agreed to.
	 Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Standing Committees on Delegated Legislation),

Representation of the People

That the draft Representation of the People (Amendment) Regulations 2008, which were laid before this House on 11th June, be approved. —[Mr. Blizzard.]
	 Question agreed to.
	 Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Standing Committees on Delegated Legislation),

London Government

That the draft London Waste and Recycling Board Order 2008, which was laid before this House on 11th June, be approved. —[Mr. Blizzard.]
	 Question agreed to.

PETITION

Immigration (John and Stella Park)

Dari Taylor: I have a petition from the residents of Teesside and others. The petitioners declare a serious concern about the possible deportation of John and Stella Park to the Republic of Korea with their mother.
	John and Stella Park are two young South Koreans who live with their mother in my constituency. They are being educated at Yarm School and are highly talented if not brilliant musicians. The request of the petitioners is that they be allowed to remain in Britain, in Yarm, to continue and finish their education with the support of their mother.
	The petition states:
	The petitioners therefore request that the House of Commons urges the Secretary of State for the Home Department to use her powers to prevent John and Stella's removal from the UK taking place, at least until they have been able to finish their school education.
	The petition was signed by 250 residents.
	 Following is the full text of the petition:
	 [ The Petition of residents of Teesside and others,
	 Declares the Petitioners' serious concerns about the possible deportation of John and Stella Park (Home Office Reference Number K2218457) to the Republic of Korea with their mother.
	 The Petitioners' further declare that John and Stella (aged 14 and 16 years) are two brilliantly talented young musicians. They are in the process of completing their education at Yarm School.
	 The Petitioners therefore request that the House of Commons urges the Secretary of State for the Home Department to use her powers to prevent John and Stella's removal from the UK taking place, at least until they have been able to finish their school education.
	 And the Petitioners remain, etc. ]
	[P000229]

LUCENTIS

Motion made, and Question proposed, That this House do now adjourn. —[Siobhain McDonagh.]

Ann Widdecombe: I am deeply grateful for this opportunity to raise this issue in the House tonight, and I look forward to the Minister's reply. The issue is the refusal of primary care trusts up and down the country—but in particular my own PCT, West Kent—to fund the provision of Lucentis and Avastin for those who are losing their sight.
	The national health service exists especially to make sure that nobody loses the ability to function in the most normal way if that is possible: to see, to hear, to have some degree of movement are all essential to function normally. They are neither luxuries nor lifestyle changes, but are utterly basic and essential. I cannot believe that the founding fathers of the NHS ever foresaw the day when that same NHS, which seems to find money for a whole lot of things that some would consider desirable but not essential, could not find money for that which is essential.
	I am going to concentrate on two constituents' cases, about which the Minister has been notified. Neither constituent wishes to be named; I shall therefore refer to them as Mr. X and Miss Y.

Ann Keen: indicated assent.

Ann Widdecombe: I am pleased to see that the Minister agrees.
	Miss Y does not wish to be named because she is a frail lady of pensionable age who does not want an enormous amount of press publicity flowing around her. Mr. X does not wish to be named because he is working and his employer does not yet know of his difficulties. For understandable reasons, he does not wish his employer to become—possibly prematurely—alarmed.
	Miss Y is well known to me. She is a pillar of the Maidstone community and a lady with whom I have worked on many a charitable project. In particular, she has shown tremendous initiative in co-ordinating a charity that helps to teach children English in the Ukraine. She helped to start it, and it continues to this day. Needless to say, she is a lady of great responsibility who has saved all her life. She has her own very small and modest flat and had saved to ensure that she would be able to meet the rainy days of her retirement.
	I visited Miss Y at home and saw first hand the difficulties that she is now experiencing as her independence is snatched from her bit by bit because of a deterioration in her sight. She is losing the sight of both eyes. Members of the public often read the press and get the idea that there is a miracle cure and demand it, but what is crucial in this case is that her consultant recommended to her that she try Lucentis. She asked whether it would be funded. That was slightly before the National Institute for Health and Clinical Excellence decreed that the treatment would be licensed and she was advised that it would not be funded. Nevertheless, she applied. The consultant said that there was an urgency to her condition, so at the same time this pensioner lady began to pay from her savings for private treatment. That cost her well in excess of £5,000 but—and this is crucial—it has been effective. It has arrested what had been a steady decline and gives her not much but something by way of sight. That reminds me of a lady who stood up at a recent meeting I attended—not about this matter at all; it was a general charitable do—and said to me, "Miss Widdecombe, do you realise that I can see you tonight only because I have paid for it?"
	Under no circumstances should we have such a system. People have always had the ability to opt out of the NHS because they preferred private facilities, but on this occasion, we are building up a picture of people who do not opt out, but are driven out because the NHS will not supply that which enables them to do something as basic as see. When I took up this lady's case with the PCT, it wrote back that her visual acuity was "outside the accepted range", but that was because she had paid to ensure that it was.
	Let me come on to the case of Mr. X. He is not a pensioner; he is only 39. He has a family of five and both he and his wife work full time. He suffers from proliferative diabetic retinopathy, but, combined with that, he also suffers from retinal vein occlusion. He is now losing his sight. The recommendation for Lucentis was again not made by him, but by his own consultant at Maidstone hospital as long ago as 2007. Mr. X was denied Lucentis.
	Mr. X, who naturally enough lives in Maidstone, has had to travel to Southport every six weeks to receive treatment. I am sure that the Minister's geography is more than up to working out the distance between Maidstone and Southport. The treatment costs £465 and the travel has to be paid on top. He has to take a day off work and, because his sight obviously limits his mobility, so, too, does his wife. They are supporting a family of five and they do not have the time to take off work. Mr. X is concerned for his future. He wants to go on working, but he cannot see that lasting for ever.
	When I wrote to the PCT, I said that
	"this man is too young to go blind"—
	as if there were ever a right age— and that
	"he needs assistance, and he needs it now".
	Such assistance has still been denied. The most recent development is the PCT writing to Mr. X to tell him that the appeal panel has deferred the decision. The letter was so cold that I actually wrote back to the PCT:
	"I have seen more sympathetic letters from motor mechanics".
	That, regrettably, is true, as there was no expression of sympathy and no hope for the future. Once again, a constituent has to pay to try to ensure that he gets what his consultant recommended in the first place.
	Very rarely, if at all, do I quote in this House anything to do with my other role as a columnist for the  Daily Express. I did, however, write about the provision of Lucentis when the newspaper was running a campaign on behalf of the war veteran, Jack Patch. As a result of the huge publicity, his PCT backed off and he is now getting his treatment, but I was flooded with letters from other Members' constituents expressing dismay that they were going blind and could not get the treatment funded, so had to pay for it themselves to avoid going blind.
	As the Minister well knows, if people are allowed to go blind, the costs to the state are horrendous. Mr. X will cease work, so he will not be productive from the age of 39 to 65 when he otherwise would have been. He will require benefits, and he will get them, as he will qualify for them. He will require all manner of additional care, and it will be forthcoming. Therefore, it does not even make economic sense to let people go blind instead of ensuring that they retain their sight for as long as possible.
	To go off track—I do not expect the Minister to answer this point—I recently read of a lady who went progressively deaf and who has a young child. She was told that a cochlear implant would solve the problem, but that her PCT would not fund the admittedly considerable cost of such an operation. In a 21st century health service, we have people who are not enabled to see, and people who are not enabled to hear—I reckon Nye Bevan is probably turning in his grave.
	Many years ago, when I was shadowing one of the Minister's predecessors, I predicted that NICE would turn out to be extremely nasty. That is what NICE has turned out to be—very nasty indeed. We are talking about real people, whose illnesses are real. The solutions have been proposed by consultants, not witch doctors, and yet they cannot get help. Will the Minister consider urgently what can be done for people such as the two constituents in different situations whom I have mentioned, and for all those others whom I am not directly representing tonight?

Ann Keen: The right hon. Member for Maidstone and The Weald (Miss Widdecombe) deserves credit for securing the debate. Her concern about such issues is well known. If she will bear with me, I will make some remarks about aspects of the working of NICE and the NHS in general, before addressing her specific points.
	I am pleased to pay tribute to all NHS staff. The right hon. Lady has expressed her concerns passionately tonight, but I am confident that she would also wish to congratulate staff in the main on their work, especially those in the West Kent PCT area and in Maidstone and the Weald.
	All of us would be greatly concerned were there any risk to our sight or to that of our loved ones. My mother had dry macular degeneration, for which no treatment was available, and I watched her sight and quality of life deteriorate. There are approximately 26,000 new cases of wet age-related macular degeneration every year, and it is the most common cause of sight loss in people aged over 60.
	We can only try to imagine the worry of someone who is at risk of losing their sight. We all want access to the best treatments available. Understandably, there is a lot of interest in this area, especially as the development of new treatments potentially offers hope to more patients than in the past. Many are helped and treated successfully.
	To provide the best possible services for NHS patients, we have a duty to ensure that new treatments used in the NHS are both clinically sound and cost-effective. That is why NICE was established in 1999. I need to remind the House of the purpose of NICE and the importance of its role, as it has had great achievements and helped many people.
	NICE was established as part of a range of measures to tackle the variations in prescribing practice across the country. Before NICE, guidance was issued by numerous bodies at national, regional and local levels, which was confusing not only for patients but, most importantly, for clinicians. The lack of coherent guidance was in part responsible for the variation in prescribing practice across the country. I am sure that the right hon. Lady is aware that NICE issues robust, evidence-based guidance on the clinical and cost-effectiveness of new and existing treatments. It has already recommended the use of photodynamic therapy for treating wet age-related macular degeneration in some patients. All PCTs are required to fund such treatment in accordance with that guidance.
	I am sure that the right hon. Lady knows that NICE is currently appraising Lucentis and Macugen for the treatment of age-related macular degeneration, and that draft guidance for the NHS was published earlier this year. That guidance recommended Lucentis, subject to a number of clinical criteria, but not Macugen. However, my Department has made clear in good practice guidance for the NHS, published in December 2006, that funding for individual treatments should not be withheld simply because NICE has not issued final guidance.

Ann Widdecombe: Miss Y has already paid for her treatment; Mr. X wants continuing treatment to be paid for. Are there any provisions—my local PCT seems to think not—for reimbursement when people would have qualified had the rulings been known earlier?

Ann Keen: I will check on that. I believe that the strategic health authority confirmed that Miss Y had not paid for Lucentis but had paid for Avastin.
	The guidance advises NHS organisations that until NICE has published final guidance on a treatment, they should continue with local arrangements for introducing new technologies, based on an assessment of the available evidence. The guidance also identifies potential sources of information to help PCTs to make such assessments.
	When the local NHS decides not to fund a treatment, the patient and the clinician can expect an explanation. To underpin that, the Government will require PCTs to establish clear and very transparent arrangements both for local decision making on the funding of new drugs and for consideration of exceptional funding requests, and to publish information on those arrangements. That is laid down in the draft constitution which we published last week.
	Lucentis and Macugen are licensed treatments for wet age-related macular degeneration. Doctors can prescribe Macugen or Lucentis in advance of NICE guidance if they believe that it is the right treatment for their patients, subject to funding from the PCT. When Lucentis was licensed in January 2007, services for people in West Kent with wet age-related macular degeneration were commissioned by the south east coast specialised commissioning group. To ensure equitable access for all patients on the south-east coast, the group commissioned the local health policy support unit's policy recommendation committee to give guidance to commissioners on the most cost-effective delivery.
	Owing to the significant differences between preliminary NICE guidance issued for consultation in June 2007 and the policy recommendation committee's guidance, a review of both guidelines was undertaken by the south east coast specialised commissioning group. The group recommended the use of Lucentis rather than Macugen, while maintaining the previous eligibility criteria.
	In the last few minutes of my speech, I want to concentrate on the right hon. Lady's constituents, Mr. X and Miss Y. I am totally sympathetic to the concerns that the right hon. Lady has raised about those two specific cases. I have been assured by South East Coast strategic health authority that such cases are considered by individual treatment panels, which always have at least one member who is a clinician. Each case is considered on its merits, and without setting precedents for future claims. Treatments may be inside or outside the national health service.
	Individual treatment panels were established in West Kent in consultation with all health community partners, primarily to consider funding for treatments for named individuals owing to their exceptional clinical circumstances and exceptions for treatments excluded by the PCT's clinical policies. West Kent PCT confirmed today that the individual treatment panel would reconsider the case of the constituent referred to as Miss Y, and would write to her and her consultant once the panel had reached a decision.
	I am exceptionally sorry that Miss Y has had to go through this trauma, which must have been very stressful for someone such as the lady whom the right hon. Lady has described. I am grateful to the right hon. Lady for raising the case with me; I am only sorry that she had to do so in this way.
	In the case of Mr. X, I have this afternoon been reassured by South East Coast SHA that it will ensure that Mr. X has the opportunity now to meet the PCT decision makers and his specialist so that they can explain the rationale for the decision. It will also ensure that a specialist provides reassurance about the recommended treatment for his condition. I am led to believe that there is concern about the recommended treatment for the condition. Therefore, I would expect any patient to be reassured and to have a lot of support and guidance about possible future treatment, and not, of course, to receive a letter.
	I understand West Kent PCT's position is that while it is sympathetic to the distress and anxiety of people within its area, it cannot fund an unlicensed and unapproved treatment when an effective and nationally recognised alternative for a condition is available, but the management of such communication is essential and I would have expected better from today's NHS.
	West Kent PCT, like every PCT, has a duty to ensure that best possible use is made of taxpayers' money to meet the health needs of its whole population. Decisions about individual cases must be based on all available evidence. The right hon. Lady would respect such decisions. It is the management of decision making that has caused distress to a young man with a young family.
	I hope that I have been able to set out the importance of having a proper evidence-based approach to the introduction of new treatments, but how we communicate about new treatments and their management is important. If at any time the right hon. Lady feels that Mr. X and Miss Y are not receiving what I have stated tonight, I will willingly meet her and take an interest in both cases. I wish both of her constituents well with their future treatment.
	 Question put and agreed to.
	 Adjourned accordingly at twenty-seven minutes past Ten o'clock.